SHOW ALL CALCULATIONS: It WILL BE AWARDED IF I CAN FOLLOW YOUR REASONING/COMPREHENSION/ UNDERSTANDING

A9-22
CASH PURCHASE PRICE	$534,000,000
% Assets & Liabilities	100%
DEC 31 2024 STILO
	FAIR	BOOK
ASSETS	ASSIGNED PENCIL	STILO
CAsH	$-	$50,000,000
ACCOUNTS RECEIVABLE	$108,000,000	$106,000,000
INVENTORY	$180,000,000	$320,000,000
PPE	$570,000,000	$618,000,000
LAND	$80,000,000	$22,000,000
FRANCHISE (UNAMORTIZED BAL)	$42,000,000	$38,000,000
		$1,154,000,000
CURRENT LIABILITIES	$74,000,000	$74,000,000
LONG TERM DEBT	$400,000,000	$400,000,000
SHAREHOLDERS EQUITY		$680,000,000
		$1,154,000,000

A9-22 Goodwill: During 20X4, the Pencil Corp. entered into negotiations to buy Stilo Company, finally agreeing on a final cash purchase price of $534,000. Pencil will acquire all assets and liabilities of Stilo effective 31 December 20X4, except for the existing cash balances of Stilo. The 31 December 20X4 balance sheet prepared by Stilo is shown below in column (a), and the revised fair values added later Page 576 by Pencil are shown in column (b). STILO COMPANY BALANCE SHEET (a) Book Values of Stilo Co. At 31 December 20X4 (b) Fair Values assigned by Pencil Corp. Assets Cash $ 50,000 n/a 106,000 $ 108,000 180,000 320,000 618,000 570,000 22.000 80,000 38,000 42.000 Accounts receivable (net) Inventory Property, plant, and equipment (net) Land Franchise (unamortized balance) Total Liabilities and shareholders' equity Current liabilities Bonds payable Shareholders' equity $1,154,000 $ 74,000 74,000 400,000 400,000 n/a 680.000 $1.154,000 Total Required: 1. Compute the amount of goodwill purchased by Pencil. 2. Give the entry for Pencil to record the purchase of Stilo