Required: Determine the amount of goodwill impairment, if any, that should be recognized at December 31, 20X4, if the fair value of the Plastic reporting =unit is determined to be | a. b. 2 c. 3 4 Rubber Corporation acquired all of the common stock of Plastic Company for $450,000 on January 1, 20X4. On that date, Plastic's identifiable net assets had a fair value of $390,000. The assets acquired in the purchase of Plastic are considered to be a separate reporting unit of Rubber. The carrying value of the Plastic reporting unit's net assets at December 31, 20X4, is $500,000. 5 a. 5 b. D 7 c. B 9 Step 1: For Goodwill Impairment Testing 1 a. 2 b. 3 с. 5 530000 485000 450000 Goodwill Impairment 60000 7 a. B b. e c. D Fair Value of Reporting Unit Carrying Value of Reporting Unit 4 5 Step 2: For Goodwill Impairment Testing V Fair Value of Fair Value of Reporting Indentifiable Unit Assets Fair Value - Carrying Value ▼ Impairment Indicated (Yes/No) No Yes Yes Implied Fair Value of Book Value of Goodwill Goodwill Fair Value vs. Book Impairment Reported Value (Yes/No) Goodwill No Yes Yes Y ▼ T

Required: Determine the amount of goodwill impairment, if any, that should be recognized at December 31, 20X4, if the fair value of the Plastic reporting =unit is determined to be | a. b. 2 c. 3 4 Rubber Corporation acquired all of the common stock of Plastic Company for $450,000 on January 1, 20X4. On that date, Plastic's identifiable net assets had a fair value of $390,000. The assets acquired in the purchase of Plastic are considered to be a separate reporting unit of Rubber. The carrying value of the Plastic reporting unit's net assets at December 31, 20X4, is $500,000. 5 a. 5 b. D 7 c. B 9 Step 1: For Goodwill Impairment Testing 1 a. 2 b. 3 с. 5 530000 485000 450000 Goodwill Impairment 60000 7 a. B b. e c. D Fair Value of Reporting Unit Carrying Value of Reporting Unit 4 5 Step 2: For Goodwill Impairment Testing V Fair Value of Fair Value of Reporting Indentifiable Unit Assets Fair Value - Carrying Value ▼ Impairment Indicated (Yes/No) No Yes Yes Implied Fair Value of Book Value of Goodwill Goodwill Fair Value vs. Book Impairment Reported Value (Yes/No) Goodwill No Yes Yes Y ▼ T

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Background: On December 31, 2021, Company A purchased acquired various assets from Company B as follows:and assumed liabilities does not meet the definition of a business under ASC 805.UmbrellaTableLemon squeezerThe books and records of Company B value these assets at December 31, 2021 as followsUmbrella $100Table $50Lemon squeezer $150Company B determined the fair value for these assets on January 1, 2022 to be as follows:Umbrella $80Table $20Lemon squeezer $100On December 31, 2021, Company A paid $350 for these assets. Question How should the acquired asset be valued and reflected on Company A's books on January 1, 2022? US GAAP standards used: ASC_____,EY FRD Business Combinations, p. Methodology applied: Calculation: Findings: Conclusion:
Snowy Ltd acquires Pax Ltd on 1 July 2018 for $5,000,000 being the fair value of the considerationtransferred. At that date, Pax Ltd’s net identifiable assets have a fair value of $4,400,000. Goodwill of$600,000 is therefore the difference between the aggregate of the consideration transferred and thenet identifiable assets acquired.The fair value of the net identifiable assets of Pax Limited are determined as follows:($000)Patent rights 200Machinery 1,000Buildings 1,500Land 2,3005,000Less: Bank loan 600Net assets 4,400At the end of the reporting period of 30 June 2019, the management of Snowy Ltd determines thatthe recoverable amount of the cash-generating unit, which is considered to be Pax Ltd, totals$4,500,000. The carrying amount of the net identifiable assets of Pax Ltd, excluding goodwill, isunchanged and remains at $4,400,000.Required:a) Prepare the journal entry to account for any impairment of goodwill. ) Assume instead that at the end of the reporting period the management…
please dont give image based answers thank you
A6 In 2022, Alliant Corporation acquired Centerpoint Incorporated for $339 million, of which $59 million was allocated to goodwill. At the end of 2024, management has provided the following information for a required goodwill impairment test: Fair value of Centerpoint Incorporated $ 247 milli Book value of Centerpoint’s net assets (excluding goodwill) 221 milli Book value of Centerpoint’s net assets (including goodwill) 280 milli Exercise 11-31 (Algo) Part 1 Require 1. Determine the amount of the impairment loss reported in the 2024 income statement. Note: Enter your answer in millions (i.e., 10,000,000 should be entered as 10).d:ononon
ABC Company acquired all of XYZ Corporation's assets and liabilities on June 30, 20X1. XYZ reported assets witha book value of P1,000,000 and liabilities of P550,000. ABC noted that XYZ included the amount P70,000 for an obsolete inventory at the acquisition date that did not appear to have any value. ABC also determined that an old machine previously used by XYZ had a fair value of P150,000 but had not been recorded by XYZ. Except for machinery and equipment, all the other assets and liabilities of XYZ approximated their fair values. In recording the transfer of assets and liabilities in its books, ABC recorded goodwill of P420,000 and paid P1,050,000 to acquire XYZ's net assets. If the book value of XYZ's machinery and equipment was P520,000, what was their fair value? *
Goodwill Impairment On January 1, 20Y3, The Simmons Group, Inc., purchased the assets of NWS Insurance Co. for $39,457,500, a price reflecting an $5,918,625 goodwill premium. On December 31, 20Y9, The Simmons Group determined that the goodwill from the NWS acquisition was impaired and had a value of only $2,219,484. a. Determine the book value of the goodwill on December 31, 20Y9, prior to making the impairment adjustment.$fill in the blank 1 b. Illustrate the effects on the accounts and financial statements of the December 31, 20Y9, adjustment for the goodwill impairment. For decreases in accounts or outflows of cash, enter your answers as negative numbers. If no account or activity is affected, select "No effect" from the dropdown and leave the corresponding number entry box blank. Balance Sheet Assets = Liabilities + Stockholders' Equity Goodwill + No effect = No effect + Retained Earnings 20Y9 Dec. 31. fill in the blank 6 fill in the blank 7 fill in the…
1. One Corporation concluded that the fair value of Two Company was P160,000 and paid that amount to acquire all of its net assets. Two reported assets with a book value of P120,000 and a fair value of 196,000 and liabilities with a book value and fair value of P46,000 on the date of combination. One also paid P6,000 to a search firm for finder’s fees related to acquisition. What amount will be recorded as goodwill by One Corporation? 26,000 10,000 16,000 0 2. On April 1, 2019, Won Corp. paid cash of P1,240,000 for all the net assets of Shein Company appropriately accounted for as a merger. The recorded assets and liabilities of Shein Company on April 5, 2019 follow: 300,000 420,000 100,000 0 3. On January 1 2021,NOP acquires 100% interest in QRS in exchange for NOP’s 10,000 shares with par value per share of P20 and fair value per share of P200. QRS’s net identifiable assets have fair value of P1,920,000 and a book value of P1,850,000. In addition, NOP agrees to provide an…
Required information [The following information applies to the questions displayed below.] In 2022, Alliant Corporation acquired Centerpoint Incorporated for $352 million, of which $62 million was allocated to goodwill. At the end of 2024, management has provided the following information for a required goodwill impairment test: Fair value of Centerpoint Incorporated Book value of Centerpoint's net assets (excluding goodwill) Book value of Centerpoint's net assets (including goodwill) $ 256 million 228 million 290 million 2. Determine the amount of goodwill reported in the year-end 2024 balance sheet. 3. Determine the amount of the impairment loss assuming that the fair value of Centerpoint is $318 million. Note: For all requirements, enter your answer in millions (i.e., 10,000,000 should be entered as 10). 2. Goodwill 3. Impairment loss million million
6
A-7
Hoolia Corporation acquires equipment and patents from another company for $50 million and records the acquisition as an asset acquisition. The equipment has a fair value of $19.20 million and the patents have a fair value of $28.80 million. Neither asset is nonqualifying. At what value does Hoolia record the equipment? Select one: a. $25.0 million b. $20.0 million c. $21.2 million d. $19.2 million
ABC Company acquired all of XYZ Corporation’s assets and liabilities on June 30, 20X1. XYZ reported assets with a book value of P1,000,000 and liabilities of P550,000. ABC noted that XYZ included the amount P70,000 for an obsolete inventory at the acquisition date that did not appear to have any value. ABC also determined that an old machine previously used by XYZ had a fair value of P150,000 but had not been recorded by XYZ. Except for machinery and equipment, all the other assets and liabilities of XYZ approximated their fair values. In recording the transfer of assets and liabilities in its books, ABC recorded goodwill of P420,000 and paid P1,050,000 to acquire XYZ’s net assets. If the book value of XYZ's machinery and equipment was P520,000, what was their fair value?