On March 1, 2023, Forest Inc. issued 50,000 voting common shares in return for all the common shares of Mountain Corporation. At that time, Forrest's shares were trading at $19 per share. After the transaction, the original shareholder group of Forrest retained control. Below is information related to Mountain Corporation:
On March 1, 2023, Forest Inc. issued 50,000 voting common shares in return for all the common shares of Mountain Corporation. At that time, Forrest's shares were trading at $19 per share. After the transaction, the original shareholder group of Forrest retained control. Below is information related to Mountain Corporation:
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
narubhai
![On March 1, 2023, Forrest Inc. issued 50,000 voting common shares in return for all the common shares of Mountain
Corporation. At that time, Forrest's shares were trading at $19 per share. After the transaction, the original shareholder
group of Forrest retained control. Below is information related to Mountain Corporation:
4
Fair value
Canying value
$ 75,000
$ 75,000
150,000
125,000
275,000
315,000
650,000
550,000
$1,150,000
$1.065.000
Cash
Accounts receivable
Inventory
Property, plant, and equipment (net)
Total assets
Current liabilities
Long-term debt
Common shares
Retained earning
Total habilities and shareholders' equity
$1.150.000
What amount of goodwill would be recorded in the consolidated statement of financial position as a result of this
acquisition?
$275,000
$105,000
$265,000
$115,000
$ 115,000
275,000
150,000
610,000
$115,000
275,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F95a360ae-c63e-4547-a6bd-b4bb0615cc7d%2F3135b6f5-2310-42f4-84bd-0e02e517a054%2Fx7jas8n_processed.jpeg&w=3840&q=75)
Transcribed Image Text:On March 1, 2023, Forrest Inc. issued 50,000 voting common shares in return for all the common shares of Mountain
Corporation. At that time, Forrest's shares were trading at $19 per share. After the transaction, the original shareholder
group of Forrest retained control. Below is information related to Mountain Corporation:
4
Fair value
Canying value
$ 75,000
$ 75,000
150,000
125,000
275,000
315,000
650,000
550,000
$1,150,000
$1.065.000
Cash
Accounts receivable
Inventory
Property, plant, and equipment (net)
Total assets
Current liabilities
Long-term debt
Common shares
Retained earning
Total habilities and shareholders' equity
$1.150.000
What amount of goodwill would be recorded in the consolidated statement of financial position as a result of this
acquisition?
$275,000
$105,000
$265,000
$115,000
$ 115,000
275,000
150,000
610,000
$115,000
275,000
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