On January 1, Coldwater Company has a net book value of $1,460,000 as follows: 1,000 shares...

Transcribed Image Text:

On January 1, Coldwater Company has a net book value of $1,460,000 as follows: 1,000 shares of preferred stock; par value $100 per share; cumulative, nonparticipating, nonvoting; call value $108 per share 20,000 shares of common stock; par value $40 per share Retained earnings Total $ 100,000 800, 000 560,000 $1,460,000 Westmont Company acquires all outstanding preferred shares for $106,000 and 60 percent of the common stock for $870,000. The acquisition-date fair value of the noncontrolling interest in Coldwater's common stock was $580,000. Westmont believed that one of Coldwater's buildings, with a 12-year remaining life, was undervalued by $50,000 on the company's financial records. What amount of consolidated goodwill would be recognized from this acquisition? On January 1, Coldwater Company has a net book value of $1,460,000 as follows: 1,000 shares of preferred stock; par value $100 per share; cumulative, nonparticipating, nonvoting; call value $108 per share 20,000 shares of common stock; par value $40 per share Retained earnings Total $ 100,000 800, 000 560,000 $1,460,000 Westmont Company acquires all outstanding preferred shares for $106,000 and 60 percent of the common stock for $870,000. The acquisition-date fair value of the noncontrolling interest in Coldwater's common stock was $580,000. Westmont believed that one of Coldwater's buildings, with a 12-year remaining life, was undervalued by $50,000 on the company's financial records. What amount of consolidated goodwill would be recognized from this acquisition?

Answer rating: 100% (QA)

Question Step 1 Consolidated Goodwill to be recognized 46000 Explanation Answer P... View the full answer