Mustang Services Inc. a public company is considering the acquisition of Warren Inc. To learn more...
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Mustang Services Inc. a public company is considering the acquisition of Warren Inc. To learn more about the business. On January 5, 2019 Mustang acquires 25% of the common shares for $4,500,000. At the time of the acquisition the net book value of Warren Inc.'s assets is $12,500,000. The purchase provided Mustang with significant influence over the activities of Warren Inc. During due diligence Mustang determined the fair value of the Warren Inc.'s assets to be as follows: Land Building Cost $ 800,000 1,500,000 Fair Value $1,200,000 2,000,000 Question1) Calculate Goodwill related to the acquisition of the shares. Mustang Services Inc. a public company is considering the acquisition of Warren Inc. To learn more about the business. On January 5, 2019 Mustang acquires 25% of the common shares for $4,500,000. At the time of the acquisition the net book value of Warren Inc.'s assets is $12,500,000. The purchase provided Mustang with significant influence over the activities of Warren Inc. During due diligence Mustang determined the fair value of the Warren Inc.'s assets to be as follows: Land Building Cost $ 800,000 1,500,000 Fair Value $1,200,000 2,000,000 Question1) Calculate Goodwill related to the acquisition of the shares.
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To calculate the goodwill related to the acquisition of the shares we need to determine the differen... View the full answer
Related Book For
South-Western Federal Taxation 2020 Comprehensive
ISBN: 9780357109144
43rd Edition
Authors: David M. Maloney, William A. Raabe, James C. Young, Annette Nellen, William H. Hoffman
Posted Date:
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