The notes to a recent annual report from Weebok Corporation included the following:
Business Acquisitions
During the current year, the Company acquired the assets of Sport Shoes, Inc . . .
Assume that Weebok acquired Sport Shoes on January 5, 2010. Weebok acquired the name of the company and all of its assets, except cash, for $472,000 cash. Weebok did not assume the liabilities. The transaction was closed on January 5, 2010, at which time the balance sheet of Sport Shoes reflected the following book values and an independent appraiser estimated the following market values for the assets:

Required:
1. Compute the amount of goodwill resulting from the purchase. (Hint: Assets are purchased at market value in conformity with the cost principle.)
2. Compute the adjustments that Weebok would make at the end of the annual accounting period, December 31, 2010, for the following:
a. Depreciation of the fixed assets (straight line), assuming an estimated remaining useful life of 10 years and no residual value.
b. Goodwill (an intangible asset with an indefinitelife).

Sport Shoes, Ine January 5, 2010 Accounts receivable (net) Inventory Fixed assets (net) Other assets Market Value $41.000 200,000 50.000 Book Value $41,000 215,000 33,000 4.000 $293,000 $55,000 238,000 $293,000 10.000 Total assets Liabilities Stockholders' equity Total liabilities and stockholders' equity