On December 31, year 1, Neal Co. issued 100,000 shares of its $10 par value common stock in exchange for all of Frey Inc.’s outstanding stock. The fair value of Neal’s common stock on December 31, year 1, was $19 per share. The carrying amounts and fair values of Frey’s assets and liabilities on December 31, year 1, were as follows: Accounts Carrying amount Fair value Cash $ 240,000 $ 240,000 Receivables 270,000 270,000 Inventory 435,000 405,000 Property, plant, and equipment 1,305,000 1,440,000 Liabilities (525,000) (525,000) Net assets $1,725,000 $1,830,000 What is the amount of goodwill resulting from the business combination?
On December 31, year 1, Neal Co. issued 100,000 shares of its $10 par value common stock in exchange for all of Frey Inc.’s outstanding stock. The fair value of Neal’s common stock on December 31, year 1, was $19 per share. The carrying amounts and fair values of Frey’s assets and liabilities on December 31, year 1, were as follows:
Accounts Carrying amount Fair value
Cash $ 240,000 $ 240,000
Receivables 270,000 270,000
Inventory 435,000 405,000
Property, plant, and equipment 1,305,000 1,440,000
Liabilities (525,000) (525,000)
Net assets $1,725,000 $1,830,000
What is the amount of
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