New Harvest Bakery acquired all the outstanding common stock of Red Rock Bakery for $68,000 in cash. The book values and fair values of Red Rock's assets and liabilities were as follows: Current assets Property, plant, and equipment Other assets Current liabilities Long-term liabilities Required: Calculate the amount paid for goodwill. Goodwill Book Value $ 24,000 44,000 4,000 16,000 24,000 Fair Value $30,000 56,000 6,000 16,000 22,000
New Harvest Bakery acquired all the outstanding common stock of Red Rock Bakery for $68,000 in cash. The book values and fair values of Red Rock's assets and liabilities were as follows: Current assets Property, plant, and equipment Other assets Current liabilities Long-term liabilities Required: Calculate the amount paid for goodwill. Goodwill Book Value $ 24,000 44,000 4,000 16,000 24,000 Fair Value $30,000 56,000 6,000 16,000 22,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![New Harvest Bakery acquired all the outstanding common stock of Red Rock Bakery for $68,000 in cash. The book values and fair
values of Red Rock's assets and liabilities were as follows:
Current assets
Property, plant, and equipment
Other assets
Current liabilities
Long-term liabilities.
Required:
Calculate the amount paid for goodwill.
Goodwill
Book Value
$ 24,000
44,000
4,000
16,000
24,000
Fair Value
$30,000
56,000
6,000
16,000
22,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F262d3d42-2fa0-41d4-ad10-169214ec4030%2F9a0b9d12-6705-45c7-9cca-98de2f5ab617%2Flwoidrf_processed.jpeg&w=3840&q=75)
Transcribed Image Text:New Harvest Bakery acquired all the outstanding common stock of Red Rock Bakery for $68,000 in cash. The book values and fair
values of Red Rock's assets and liabilities were as follows:
Current assets
Property, plant, and equipment
Other assets
Current liabilities
Long-term liabilities.
Required:
Calculate the amount paid for goodwill.
Goodwill
Book Value
$ 24,000
44,000
4,000
16,000
24,000
Fair Value
$30,000
56,000
6,000
16,000
22,000
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