Return to question On September 1 of year 1, Riverside Corporation (RC), a calendar-year taxpayer, acquired the assets of another business in a taxable acquisition. When the purchase price was allocated to the assets purchased, RC determined it had purchased $1,260,000 of goodwill for both book and tax purposes. At the end of year 1, RC determined that the goodwill had not been impaired during the year. In year 2, however, RC concluded that $355,000 of the goodwill had been impaired and wrote down the goodwill by $355,000 for book purposes. Required: a. What book-tax difference associated with its goodwill should RC report in year 1? Is it favorable or unfavorable? Is it permanent or temporary? b. What book-tax difference associated with its goodwill should RC report in year 2? Is it favorable or unfavorable? Is it permanent or temporary? Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Complete this question by entering your answers in the tabs below. Req A Req B What book-tax difference associated with its goodwill should RC report in year 1? Is it favorable or unfavorable? Is it permanent or temporary? (Do not round Intermediate computations.) Book-tax difference 42,000 Is it favorable or unfavorable? Favorable Is it permanent or temporary? Temporary Next >