Core Telecom provides communication services in Iowa, Nebraska, the Dakotas, and Montana. Core purchased goodwill as part

Question:

Core Telecom provides communication services in Iowa, Nebraska, the Dakotas, and Montana. Core purchased as part of the acquisition of Surety Wireless Company, which had the following figures:
Book value of assets .......................... $ 700,000
Market value of assets .......................... 1,000,000
Market value of liabilities ..................... 510,000
Requirements
1. Journalize the entry to record Core's purchase of Surety Wireless for $280,000 cash plus a $420,000 note payable.
2. What special asset does Core's acquisition of Surety Wireless identify? How should Core Telecom account for this asset after acquiring Surety Wireless? Explain in detail.
Goodwill
Goodwill is an important concept and terminology in accounting which means good reputation. The word goodwill is used at various places in accounting but it is recognized only at the time of a business combination. There are generally two types of...