Peters Restaurants acquired Corner Diners. The financial records of Corner Diners included the following: Book Value of

Question:

Peter’s Restaurants acquired Corner Diners. The financial records of Corner Diners
included the following:
Book Value of Assets ....................................................................................... $2.3 million
Market Value of Assets .................................................................................... 2.45 million
Market Value of Liabilities................................................................................ 1.1 million

Requirements
1. Make the journal entry to record Peter’s Restaurants’ purchase of Corner Diners for $2.2 million cash, including any .
2. How should Peter’s Restaurants account for this after acquiring Corner Diners? 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...