Question: Taste T Company has been in business for 30 years
Taste- T Company has been in business for 30 years and has developed a large group of loyal restaurant customers. Down Home Foods made an offer to buy Taste- T Company for $ 6,000,000. The market value of Taste- T’s tangible assets, net of liabilities, on the date of the offer is $ 5,600,000. Taste- T also holds a patent for a fluting machine that the company invented (the patent with a market value of $ 200,000 amar-ketvalueof$200,000 was never recorded by Taste- T because it was developed internally). How much has Down Home Foods included for intangibles in its offer of $ 6,000,000? Assuming Taste- T accepts this offer, which company will report Goodwill on its balance sheet and at what amount?
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