On January 1, the Richard Company acquired all of the net assets of the Ulmer Company by
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- On January 1, the Richard Company acquired all of the net assets of the Ulmer Company by issuing bonds with a par and fair value of $500,000 and cash of $300,000. The fair values of Ulmer's identifiable net assets were equal to their values book value, except for buildings and equipment, which had a fair value of $120,000 above book value. The balance sheets of the two companies immediately prior to the acquisition were as follows:
richard company | Ulmer Company | |
Money | $400,000 | $150,000 |
Buildings and Equipment | $700,000 | $400,000 |
Accumulated depreciation | $(300,000) | $(150,000) |
Other identifiable assets | $100,000 | $200,000 |
total assets | $ 900,000 | $600,000 |
Passive | $200,000 | $100,000 |
Common actions | $400,000 | $300,000 |
Additional payment in principal | $160,000 | $100,000 |
Retained earnings | $140,000 | $100,000 |
Total Liabilities and Equity | $ 900,000 | $600,000 |
Based on the above information, calculate the amount of Goodwill to be recognized in connection with the merger .
Related Book For
Advanced Financial Accounting
ISBN: 978-0078025624
10th edition
Authors: Theodore E. Christensen, David M. Cottrell, Richard E. Baker
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