On January 1, Year 4, Dean purchased all of Kay's $10 par, voting common stock for $600,000. On that date, the fair values of Kay's assets and liabilities equaled their carrying amounts of $660,000 and $160,000, respectively. Dean amortizes its intangible assets over a 10-year period using the straight-line method.

1. During Year 4, Dean and Kay paid cash dividends of $50,000 and $10,000, respectively. For tax purposes, Dean receives the 100% exclusion for dividends received from Kay.
2. No intraentity transactions occurred except for Dean's (1) receipt of dividends from Kay and (2) recording of its share of Kay's earnings.
3. On June 30, Year 4, Dean sold 2,000 shares of its common stock for $17 per share. No other changes occurred in either Dean's or Kay's common stock during Year 4.

In Dean's Year 4 consolidated income statement, what amount should be reported for amortization of goodwill?

Answer rating: 100% (QA)

When Dean purchased all of Kays 10 par voting common stock for 600000 the fair values of Kays assets ... View the full answer