How much goodwill should be recognized by Alto Company when recording the purchase of Franz?
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Alto Company purchases Franz Company for $13,985,000 cash on January 1, 2022. The book value of Franz Company’s net assets reported on its December 31, 2021
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- Tamara Corporation acquired XW Products on January 1, 2020 for $6,400,000, and recorded goodwill of $1,200,000 as a result of that purchase. At December 31, 2021, the XW Products Division had a fair value of $5,450,000. The net identifiable assets of the Division (excluding goodwill) had a fair value of $4,745,000 at that time. What amount of loss on impairment of goodwill should Tamara record in 2021? 16.The following information concerns the intangible assets of Epstein Corporation:a. On June 30, 2021, Epstein completed the acquisition of the Johnstone Corporation for $2,000,000 in cash. The fair value of the net identifiable assets of Johnstone was $1,700,000.b. Included in the assets purchased from Johnstone was a patent that was valued at $80,000. The remaining legal life of the patent was 13 years, but Epstein believes that the patent will only be useful for another eight years.c. Epstein acquired a franchise on October 1, 2021, by paying an initial franchise fee of $200,000. The contractual life of the franchise is 10 years.Required:1. Prepare year-end adjusting journal entries to record amortization expense on the intangibles at December 31, 2021.2. Prepare the intangible asset section of the December 31, 2021, balance sheet.On August 1, 2017, Concord Corporation acquired Skysong, Inc. for a cash payment of $2.10 million. At the time of purchase, Skysong's balance sheet showed assets of $4,350,000, liabilities of $2,550,000, and owners' equity of $1,800,000. The fair value of Skysong's identifiable assets is estimated to be $4,326,000. Compute the amount of goodwill acquired by Concord. Value assigned to goodwill $
- 1. On July 1, 2010, Jablonski Products purchased the net assets of Duquesne Industries for $285,000 (cash of $85,000 and a short-term note payable of $200,000). The assets included current assets of $125,000, property, plant, and equipment with a fair value of $250,000 (book value of $300,000), and a trademark valued at $150,000. Jablonski assumed liabilities totaling $200,000. The entry to record the purchase would include: O A) A debit to Goodwill of $40,000 B) A credit to Gain on Purchase of $90,000 O C) A credit to Goodwill of $40,000 D) A debit to Goodwill of $90,000 O E) A credit to Gain on Purchase of $40,000Barb Company has provided information on intangible assets as follows: A patent was purchased from Lou Company for $1,500,000 on January 1, 2018. Barb estimated the remaining useful life of the patent to be 10 years. The patent was carried in Lou's accounting records at a net book value of $1,250,000 when Lou sold it to Barb. During 2019, a franchise was purchased from Rink Company for $500,000. In addition, 5% of revenue from the franchise must be paid to Rink. Revenue from the franchise for 2019 was $2,000,000. Barb estimates the useful life of the franchise to be 10 years and takes a full year's amortization in the year of purchase. Barb incurred R&D costs in 2019 as follows: Materials and equipment $120,000 Personnel 140,000 Indirect costs 60,000 $320,000 Barb estimates that these costs will be recouped by December 31, 2020. On January 1, 2019, Barb estimates, based on new events, that the remaining life of the patent purchased on January 1, 2018, is only 5 years…Action, Inc. acquired the following assets and assumed the related liabilities of Slacker Corp. in a transaction completed on February 16, 2023: Accounts receivable, net Inventories Property, plant & equipment Non-amortizable intangible assets Carrying value for Slacker Current liabilities Noncurrent liabilities $ 11,000 $ 50,000 $ 100,000 $ 200,000 Fair Value $ 10,000 $ 50,000 $ 150,000 $ 225,000 $ (40,000) $(200,000) $ (40,000) $(200,000) Action paid $205,000 in cash for all of the above from Slacker. a) Determine if Action must record any goodwill. Show any calculations. b) Record the acquisition in Action's general journal on Feb. 16, 2023. Show: any calculations. c) Prepare any adjusting entry for amortization required as of the fiscal year end, December 31, 2023. If no amortization is required, explain why.
- On January 2, 2021, Big company classified non current asset with a carrying amount of P2,400,000 as held for sale. On this date, the asset is expected to be sold for P2,300,000 with expected cost to sell of P100,000. By December 31, 2021,the asset's fair value is P2,400,000 with estimated disposal cost of P50,000. On January 10, 2022, the asset was sold for P2,000,000. Cost to sell amounts to P35,000How much recovery on impairment is to be recognized on December 31, 2021?On January 1, 2025, Sunland Company makes the two following acquisitions. 1. Purchases land having a fair market value of $860,000 by issuing a 5-year, zero-interest-bearing promissory note in the face amount of $1,263,622. 2. Purchases equipment by issuing a 5%, 9-year promissory note having a maturity value of $350,000 (Interest payable annually on January 1). The company has to pay 9% interest for funds from its bank. (a) Record the two journal entries that should be recorded by Sarasota Company for the two purchases on January 1, 2025. (b) Record the interest at the end of the first year on both notes using the effective-interest method.The following information relates to the intangible assets of Lettuce Express:a. On January 1, 2021, Lettuce Express completed the purchase of Farmers Produce, Inc., for $1,600,000 in cash. The fair value of the identifiable net assets of Farmers Produce was $1,440,000.b. Included in the assets purchased from Farmers Produce was a patent for a method of processing lettuce valued at $49,500. The original legal life of the patent was 20 years. There are still 17 years left on the patent, but Lettuce Express estimates the patent will be useful for only 9 more years.c. Lettuce Express acquired a franchise on July 1, 2021, by paying an initial franchise fee of $216,000. The contractual life of the franchise is eight years.Required:1. Record amortization expense for the intangible assets at December 31, 2021.2. Prepare the intangible asset section of the December 31, 2021, balance sheet.
- Wildhorse Corporation acquired End-of-the-World Products on January 1, 2020 for $6250000, and recorded goodwill of $1170000 as a result of that purchase. At December 31, 2021, the End-of-the-World Products Division had a fair value of $4580000. The net identifiable assets of the Division (including goodwill) had a carrying value of $5290000 at that time. What amount of loss on impairment of goodwill should Wildhorse record in 2021?Carla Vista Corporation acquired End-of-the-World Products on January 1, 2020 for $6150000, and recorded goodwill of $1150000 as a result of that purchase. At December 31, 2021, the End-of-the-World Products Division had a fair value of $4482000. The net identifiable assets of the Division (including goodwill) had a carrying value of $5190000 at that time. What amount of loss on impairment of goodwill should Carla Vista record in 2021? $960000 $1668000 $0 $708000On September 1, 2020, Flint Corporation acquired Tamarisk Enterprises for a cash payment of $710,000. At the time of purchase, Tamarisk's balance sheet showed assets of $560,000, liabilities of $240,000, and owners' equity of $320,00O. The fair value of Tamarisk's assets is estimated to be $790,000. Compute the amount of goodwill acquired by Flint. Value assigned to goodwill $
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