On January 1, 2023, Pali Company acquired 75% of Silicon Company's voting stock for $44,300 in...

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On January 1, 2023, Pali Company acquired 75% of Silicon Company's voting stock for $44,300 in cash. The noncontrolling interest had an estimated fair value of $12,700. Silicon's assets and liabilities at the date of acquisition were reported at amounts approximating fair value, but it had previously unreported indefinite life identifiable intangibles valued at $21,000. Silicon's total shareholders' equity at January 1, 2023 was as follows: Capital stock $ 2,000 Retained earnings 2,900 Accumulated other comprehensive income Total 100 $5,000 It is now December 31, 2025 (three years later). Identifiable intangibles impairment through the end of 2024 was $1,000 and goodwill impairment through the end of 2024 was $400. There is no impairment of either identifiable intangibles or goodwill in 2025. Pali uses the complete equity method to account for its investment. December 31, 2025 trial balances for Pali and Silicon follow. Current assets Property, net Intangibles Investment in Silicon Goodwill Silicon Pali Dr (Cr) Dr (Cr) $5,000 $1,000 42,000 28,000 45,732 It is now December 31, 2025 (three years later). Identifiable intangibles impairment through the end of 2024 was $1,000 and goodwill impairment through the end of 2024 was $400. There is no impairment of either identifiable intangibles or goodwill in 2025. Pali uses the complete equity method to account for its investment. December 31, 2025 trial balances for Pali and Silicon follow. Current assets Property, net Intangibles Investment in Silicon Goodwill Liabilities Capital stock RE, beginning AOCI, beginning Sales revenue Silicon Pali Dr (Cr) Dr (Cr) $5,000 $1,000 42,000 28,000 45,732 (53,887) (20,664) (15,000) (2,000) (19,680) (4,400) (1,100) (116) (25,000) (14,000) Equity in net income of Silicon (1,350) Equity in OCI of Silicon (15) Cost of goods sold 20,000 9,000 Operating expenses 4,000 3,200 Other comprehensive income (700) (20) Sales revenue Equity in net income of Silicon (1,350) Equity in OCI of Silicon (15) Cost of goods sold 20,000 9,000 Operating expenses 4,000 3,200 Other comprehensive income (700) (20) Total $0 $0 What is the initial goodwill related to this acquisition? Select one: (25,000) (14,000) a. $52,000 b. $36,000 c. $31,000 d. $18,300 On January 1, 2023, Pali Company acquired 75% of Silicon Company's voting stock for $44,300 in cash. The noncontrolling interest had an estimated fair value of $12,700. Silicon's assets and liabilities at the date of acquisition were reported at amounts approximating fair value, but it had previously unreported indefinite life identifiable intangibles valued at $21,000. Silicon's total shareholders' equity at January 1, 2023 was as follows: Capital stock $ 2,000 Retained earnings 2,900 Accumulated other comprehensive income Total 100 $5,000 It is now December 31, 2025 (three years later). Identifiable intangibles impairment through the end of 2024 was $1,000 and goodwill impairment through the end of 2024 was $400. There is no impairment of either identifiable intangibles or goodwill in 2025. Pali uses the complete equity method to account for its investment. December 31, 2025 trial balances for Pali and Silicon follow. Current assets Property, net Intangibles Investment in Silicon Goodwill Silicon Pali Dr (Cr) Dr (Cr) $5,000 $1,000 42,000 28,000 45,732 It is now December 31, 2025 (three years later). Identifiable intangibles impairment through the end of 2024 was $1,000 and goodwill impairment through the end of 2024 was $400. There is no impairment of either identifiable intangibles or goodwill in 2025. Pali uses the complete equity method to account for its investment. December 31, 2025 trial balances for Pali and Silicon follow. Current assets Property, net Intangibles Investment in Silicon Goodwill Liabilities Capital stock RE, beginning AOCI, beginning Sales revenue Silicon Pali Dr (Cr) Dr (Cr) $5,000 $1,000 42,000 28,000 45,732 (53,887) (20,664) (15,000) (2,000) (19,680) (4,400) (1,100) (116) (25,000) (14,000) Equity in net income of Silicon (1,350) Equity in OCI of Silicon (15) Cost of goods sold 20,000 9,000 Operating expenses 4,000 3,200 Other comprehensive income (700) (20) Sales revenue Equity in net income of Silicon (1,350) Equity in OCI of Silicon (15) Cost of goods sold 20,000 9,000 Operating expenses 4,000 3,200 Other comprehensive income (700) (20) Total $0 $0 What is the initial goodwill related to this acquisition? Select one: (25,000) (14,000) a. $52,000 b. $36,000 c. $31,000 d. $18,300

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