Question: On 1st January QRS Ltd is formed with capital of

On 1st January, QRS Ltd is formed with capital of £250,000, all of which is held in the company’s bank account. On the same day, QRS purchases an existing business from Taylor plc for £400,000. An independent valuer has valued the assets as follows:
Plant & Equipment ......... £100,000
Trade receivables ......... £ 50,000
Inventory ............. £ 75,000
QRS funds the acquisition by a long-term borrowing of £150,000 and using its available cash.
a. Show the Balance Sheet of QRS after these transactions have taken place.
b. If QRS wishes to a mortise its goodwill over 10 years, how will goodwill appear in the Balance Sheet at the end of the first year?

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  • CreatedSeptember 15, 2015
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