On June 1, Cline Co. paid $800,000 cash for all of the issued and outstanding common stock of Renn Corp. The carrying values for Renn's assets and liabilities on June 1 follow: Cash Accounts receivable $150,000 180,000 Capitalized software costs 320,000 Goodwill Liabilities Net assets 100,000 (130,000) $620,000 On June 1, Renn's accounts receivable had a fair value of $140,000. Additionally, Renn's in-process research and development was estimated to have a fair value of $200,000. All other items were stated at their fair values. On Clines June 1 consolidated balance sheet, how much is reported for goodwill? a. $320,000. b. $120,000. c. $80,000. d. $20,000.

On June 1, Cline Co. paid $800,000 cash for all of the issued and outstanding common stock of Renn Corp. The carrying values for Renn's assets and liabilities on June 1 follow: Cash Accounts receivable $150,000 180,000 Capitalized software costs 320,000 Goodwill Liabilities Net assets 100,000 (130,000) $620,000 On June 1, Renn's accounts receivable had a fair value of $140,000. Additionally, Renn's in-process research and development was estimated to have a fair value of $200,000. All other items were stated at their fair values. On Clines June 1 consolidated balance sheet, how much is reported for goodwill? a. $320,000. b. $120,000. c. $80,000. d. $20,000.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter11: The Statement Of Cash Flows

Section: Chapter Questions

Problem 11MCQ: Chasse Building Supply Inc. reported net cash provided by operating activities of $243,000, capital...

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On June 1, Cline Co. paid $1,104,500 cash for all of the issued and outstanding common stock of Renn Corp. The carrying amounts for Renn’s assets and liabilities on June 1 follow: Cash $ 249,000 Accounts receivable 262,500 Capitalized software costs 385,000 Goodwill 155,000 Liabilities (140,000 ) Net assets $ 911,500 On June 1, Renn’s accounts receivable had a fair value of $183,000. Additionally, Renn’s in-process research and development was estimated to have a fair value of $223,000. All other items were stated at their fair values. On Cline’s June 1 consolidated balance sheet, how much is reported for goodwill?
On June 1, Cline Co. paid $870,000 cash for all of the issued and outstanding common stock of Renn Corp. The carrying amounts for Renn’s assets and liabilities on June 1 follow: Cash $ 239,000 Accounts receivable 181,000 Capitalized software costs 340,000 Goodwill 103,000 Liabilities (226,000 ) Net assets $ 637,000 On June 1, Renn’s accounts receivable had a fair value of $136,000. Additionally, Renn’s in-process research and development was estimated to have a fair value of $253,000. All other items were stated at their fair values. On Cline’s June 1 consolidated balance sheet, how much is reported for goodwill? Multiple Choice $340,000. $20,000. $128,000. $83,000.
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