Roxbury, Corp., aggressively acquired other companies. Assume that Roxbury, Corp., purchased Lallor, Inc., for $15 million cash.

Question:

Roxbury, Corp., aggressively acquired other companies. Assume that Roxbury, Corp., purchased Lallor, Inc., for $15 million cash. The market value of Lallor’s assets is $20 million, and it has liabilities with a market value of $6 million.

Requirements
1. Compute the cost of purchased by Roxbury, Corp.
2. Record the purchase of Lallor, Inc., by Roxbury, Corp.

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...