The Turner Company acquired the Hanson Company for a cash price of $13,975,000. In addition, the Turner Company assumed all liabilities of the Hanson Company as part of the acquisition. The following are the fair market values of the assets and liabilities of the Hanson Company that were acquired:

Property, Plant, and Equipment 4,823,000

Unearned Revenue 4,476,000

Patents 6,513,000

Accounts Receivable 1,536,000

Accounts Payable 2,720,000

Inventories 1,510,000

Interest Payable 3,670,000

REQUIRED:

(1) Record the COMPLETE journal entry to recognize the acquisition of the Hanson

Company by the Turner Company.

(2) At the end of the second year after the acquisition, the fair value of the Goodwill

has decreased by $1,670,000. Record the journal entry to recognize this decrease in

value.