On April 1, 2017, Paape Company paid $950,000 for all the issued and outstanding stock of Simon Corporation. The recorded assets and liabilities of the Simon Corporation on April 1, 2017, follow: Cash$ 80,000Inventory240,000Property and equipment (net of accumulated depreciation of $320,000)480,000Liabilities(180,000) On April 1, 2017, it was determined that the inventory of Simon had a fair value of $190,000, and the property and equipment (net) had a fair value of $560,000. What is the amount of goodwill resulting from the business combination? Select one:a.$230,000b.$120,000c.$0d.$300,000

Calcualtion of goodwill Cash 80,000.00 inventory 190,000.00 property &…

Answered: $ 80,000 Inventory 240,000 Property…

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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On April 1, 2017, Paape Company paid $950,000 for all the issued and outstanding stock of Simon Corporation. The recorded assets and liabilities of the Simon Corporation on April 1, 2017, follow:

Cash	$ 80,000
Inventory	240,000
Property and equipment (net of accumulated depreciation of $320,000)	480,000
Liabilities	(180,000)

On April 1, 2017, it was determined that the inventory of Simon had a fair value of $190,000, and the property and equipment (net) had a fair value of $560,000. What is the amount of goodwill resulting from the business combination?

Select one:

a.$230,000

b.$120,000

c.$0

d.$300,000

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