S7-17. (Learning Objective 5: Measure and record goodwill) Munchies, Inc, dominates the snack-food industry with its Salty Chip brand. Assume that Munchies purchased Sweet Snacks Company for $5.4 million cash. The market value of Sweet Snacks' assets is $10 million, and Sweet Snacks has liabilities with a market value of $7.1 million. Requirements 1. Compute the cost of the goodwill purchased by Munchies. 2. Explain how Munchies will account for goodwill in future years