On November 13, Underhill, Incorporated, a calendar year taxpayer, purchased a business for a $764,600 lump-sum...

 

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On November 13, Underhill, Incorporated, a calendar year taxpayer, purchased a business for a $764,600 lump-sum price. The business's balance sheet assets had the following appraised FMV: Accounts receivable Inventory Tangible personalty $ 58,500 193,500 432,500 $ 684,500 Required: a. What is the cost basis of the goodwill acquired by Underhill on the purchase of this business? b. Compute Underhill's goodwill amortization deduction for the year of purchase. c. Assuming a 21 percent tax rate, compute the deferred tax asset or deferred tax liability (identify which) resulting from Underhill's amortization deduction. On November 13, Underhill, Incorporated, a calendar year taxpayer, purchased a business for a $764,600 lump-sum price. The business's balance sheet assets had the following appraised FMV: Accounts receivable Inventory Tangible personalty $ 58,500 193,500 432,500 $ 684,500 Required: a. What is the cost basis of the goodwill acquired by Underhill on the purchase of this business? b. Compute Underhill's goodwill amortization deduction for the year of purchase. c. Assuming a 21 percent tax rate, compute the deferred tax asset or deferred tax liability (identify which) resulting from Underhill's amortization deduction.