On 1 January 2019, Bad Ltd acquired all the assets and liabilities of Wolf Ltd. Wolf Ltd has several operating divisions, including one whose major industry is the manufacture of toy trains, particularly those of historical significance. The toy trains division is regarded as a CGU. In paying $2 million for the net assets of Wolf Ltd, Bad Ltd calculated that it had acquired goodwill of $240 000. The goodwill was allocated to each of the divisions, and the assets and liabilities acquired meas-red at fair value at acquisition date. At 31 December 2021, the carrying amounts of the assets of the toy train division were: Factory $250 000 Inventory $150 000 Brand — ‘Froggy’ $50 000 Goodwill $50 000 Total 500 000 There is a declining interest in toy trains because of the aggressive marketing of computer-based toys, so the management of Bad Ltd measured the value in use of the toy train division at 31 December 2021, determining it to be $423 000.
On 1 January 2019, Bad Ltd acquired all the assets and liabilities of Wolf Ltd.
Wolf Ltd has several operating divisions, including one whose major industry is the manufacture of toy trains, particularly those of historical significance.
The toy trains division is regarded as a CGU. In paying $2 million for the net assets of Wolf Ltd, Bad Ltd calculated that it had acquired
The goodwill was allocated to each of the divisions, and the assets and liabilities acquired meas-red at fair value at acquisition date.
At 31 December 2021, the carrying amounts of the assets of the toy train division were:
|
Factory |
$250 000 |
|
Inventory |
$150 000 |
|
Brand — ‘Froggy’ |
$50 000 |
|
Goodwill |
$50 000 |
|
Total |
500 000 |
There is a declining interest in toy trains because of the aggressive marketing of computer-based toys, so the management of Bad Ltd measured the value in use of the toy train division at 31 December 2021, determining it to be $423 000.
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