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Question 18 Not yet answered On May 31, 2016, Columbanus Company paid $2,000,000 to acquire all of the common stock of Mistor Corporation, which became
Question 18 Not yet answered On May 31, 2016, Columbanus Company paid $2,000,000 to acquire all of the common stock of Mistor Corporation, which became a division of Columbanus. Mistor reported the following balance sheet at the time of the acquisition: Points out of 3.00 Current assets Noncurrent assets Total assets $400,000 1.800.000 Current liabilities $400,000 Long-term liabilities 200,000 Stockholders' equity 1.600.000 Total liabilities and stockholders' equity $2,200.000 Flag question S2.200.000 It was determined at the date of the purchase that the fair value of the identifiable net assets of Mistor was $1,875,000. At December 31, 2016, Mistor reports the following balance sheet information: Current assets Noncurrent assets (including goodwill recognized in purchase) Current liabilities Long-term liabilities Stockholders' Equity DR (CR) S600,000 1,600,000 (500,000) (300,000 (1,400,000) The recorded amount for Mistor's net assets (excluding goodwill) is the same as fair value, except for property, plant, and equipment, which has a fair value of $75,000 above the carrying value. Assume the 12/31/16 fair value of the Mistor division is $1,375,000. On 5/31/16, Columbanus Company recorded Goodwill of: : Select one: a. $325,000 b. $400,000 c. $1,275,000 d. $200,000 e. $125,000
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