Hello tutor please answer Lake Incorporated purchased all of the outstanding stock of Huron Company paying$952,000 cash. Lake assumed all of the abilities of Huron. Book values and fair values ofacquired assets and liabilities were:Book Value Fair ValueCurrent assets (net)$130,500$123,000Property, plant, equip. (net) 603,000762,000Liabilities151,000176,000Lake would record goodwill of

Step 1: Define GoodwillGoodwill is an intangible asset that arises when a company acquires another…

Answered: Lake Incorporated purchased all of the…

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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Lake Incorporated purchased all of the outstanding stock of Huron Company paying $951,000 cash. Lake assumed all of the liabilities of Huron. Book values and fair values of acquired assets and liabilities were: Book Value Fair Value Current assets (net) $ 130,200 $ 123,200 Property, plant, equpiment (net) 616,000 768,000 Liabilities 150,100 175,000 Lake would record goodwill of:
Lake Incorporated purchased all of the outstanding stock of Huron Company, paying $850,000 cash. Lake assumed all of the liabilities. Book values and fair values of acquired assets and liabilities were: Book Value Fair Value Current assets (net) $ 130,000 $ 125,000 Property, plant, equip. (net) 600,000 750,000 Liabilities 175,000 175,000 Lake would record goodwill of:
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Northern Equipment Corporation purchased all the outstanding common stock of Pioneer Equipment Rental for $5,600,000 in cash. The book values and fair values of Pioneer’s assets and liabilities were Book Value Fair ValueAccounts Receivable $ 750,000 $ 650,000Buildings 4,100,000 4,800,000Equipment 110,000 200,000Accounts Payable (750,000) (750,000)Net assets $ 4,210,000 $ 4,900,000Required:1. Calculate the amount Northern Equipment should report for goodwill.2. Record Northern Equipment’s acquisition of Pioneer Equipment Rental.
Mary Limited acquired the identifiable assets and liabilities of Joan Limited. The items acquired are: equipment $296 000; inventories $160 000; accounts receivable $90 000 (fair value $104 000); patents $60 000; accounts payable $80 000. The net assets were acquired for consideration of $530 000. The difference on acquisition is: a. Goodwill of $10 000 b. Goodwill of $170 000 c. Gain on bargain purchase of $10 000 d. Gain on bargain purchase of $156 000 e. Goodwill of $4 000
Lake Incorporated purchased all of the stock of Huron Company, paying $950,000 cash. Lake also assumed all of the liabilities of Huron. Book values and fair values of the acquired assets and liabilities were: Book value Fair value Current assets (net) $130,000 $125,000 Property, plant & equipment (net) 600,000 750,000 Liabilities 150,000 175,000 Required:What amount of Goodwill should Lake Inc. record in connection with this purchase?
A Ltd purchases the B Ltd for the following consideration of: Cash : $150 000 Land: carrying amount of the land is $120 000; fair value is $195 000. The statement of financial position of the B Ltd as at the date of acquisition shows assets of $390 000 and liabilities of $195 000. All assets are fairly valued except the B Ltd's building, which is in the accounts at $70 000 but has a fair value of $95 000. There are no contingent liabilities. Required: Calculate the value of goodwill?
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Hoover Company acquired Burgess Company for $1,200,000 cash. The fair value of Burgess's assets was $1,040,000, and the company had liabilities of $60,000. Which of the following journal entries would be used to record the purchase of Burgess Company? Multiple Choice Burgess assets Burgess liabilities Goodwill Cash Burgess assets Cash 1,040,000 60,000 100,000 1,200,000 1,200,000 1,200,000
SFFN Corp. purchased the entire business of AZC, Inc. including all its assets and liabilities for $1,800,000. Below is information related to the two companies: SFFN AZC Fair value of assets $ 3,050,000 $ 1,600,000 Fair value of liabilities 2,575,000 800,000 Reported assets 2,800,000 1,400,000 Reported liabilities 2,500,000 750,000 Net Income for the year 460,000 250,000 How much goodwill will SFFN recognize as a result of its acquisition of AZC? Select one: a. $-0- b. $1,225,000 c. $1,150,000 d. $200,000 e. $1,000,000
Purple Corp. purchased all of the listed assets and liabilities of Sudden Corp. for $1,600,000. The following assets and liabilities were purchased:Book Value Fair MarketValueAccounts receivables $ 140,000 $ 140,000 Inventory 168,000 256,000 Property, plant, and equipment (net) 820,000 1,040,000 Patent 0 276,000 Liabilities (170,000 ) (170,000 )________________________________________ Required:1. What is the appropriate amount that would be recorded for goodwill? 2. Prepare the journal entry for the acquisition. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

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