Question 31

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X Co acquired 80% of Y Co outstanding capital stock for $430,000 cash. Immediately before the purchase, the balance sheets of both co reported the following

X CO Y CO

Assets 2,000,000 750,000

Liabilities 750,000 400,000

Common Stock 1,000,000 310,000

Retained Earnings 250,000 40,000

Liabilities & Stockholders Equity 2,000,000 750,000

At the date of purchase, the fair value of Y assets was $50,000 more than the Book value amounts. In the consolidated balance sheet prepared immediately after the purchase,the goodwill should amount to

Select one:

a. 237,500

b. 30,000

c. 137,500

d. 130,000