Assume Hurd Co paid 28 million to purchase Southwest com Assume
Assume Hurd Co. paid $28 million to purchase Southwest.com. Assume further that southwest had the following summarized data at the time of the Hurd Co. acquisition (amounts in millions):


Southwest’s long-term assets had a current market value of only $32 million, and liabilities have a market value of $29 million.

Requirements
1. Compute the cost of goodwill purchased by Hurd Co.
2. Journalize Hurd Co.’s purchase of Southwest.
3. Explain how Hurd Co. will account forgoodwill.
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