Canby Corporation purchased a 40% interest in thecommon stock of Brookings Company for $3.600,000 onJanuary 2, 2021, when the book value of Brooking's netstockholder's equity was $8,000,000. Brooking's bookvalues equaled their fair values except for the followingitems: (in thousands)BookFairDifferenceValueValueInventories$500$600$100Land$100$350$250Buildings - net (15 year remaining$300$550$250useful life.)Equipment - net (5 year remaininguseful life.)$600$400-$200Required:1. Perform the preliminary calculations to determinegoodwill.2. Prepare an Amortization Schedule for the fair value/book value differences toinclude the initial amounts determined and amortization expense for 2021 andunamortized balances at 12-31-2021. (Hint: The unamortized excess for thebuildings at year end will be $93).

Goodwill is the amount which might arises at the time of the acquisition of some interest on the…

1. Perform the preliminary calculations to determine goodwill. 2. Prepare an Amortization Schedule for the fair value/book value differences to include the initial amounts determined and amortization expense for 2021 and unamortized balances at 12-31-2021. (Hint: The unamortized excess for the buildings at year end will be $93).

1. Perform the preliminary calculations to determine goodwill. 2. Prepare an Amortization Schedule for the fair value/book value differences to include the initial amounts determined and amortization expense for 2021 and unamortized balances at 12-31-2021. (Hint: The unamortized excess for the buildings at year end will be $93).

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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