Question: When one media company buys another, goodwill is often the most costly asset. TMC Advertising paid $170,000 to acquire Seacoast Report, a weekly advertising paper.

When one media company buys another, goodwill is often the most costly asset. TMC Advertising paid $170,000 to acquire Seacoast Report, a weekly advertising paper. At the time of the acquisition, Seacoast Report’s balance sheet reported total assets of $130,000 and liabilities of $70,000. The fair market value of Seacoast Report’s assets was $100,000.
Requirements
1. How much goodwill did TMC Advertising purchase as part of the acquisition of Seacoast Report?
2. Journalize TMC Advertising’s acquisition of Seacoast Report.

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