Do fast answer of this general accounting question Summit Corp. has 20 million shares outstanding and trades at $40 pershare. Summit has net identifiable assets with a book value of $600million and a fair value of $800 million. Apex Corporation purchasesall of Summit Corp. stock for $45 per share. How much will Apexrecord as goodwill upon acquiring Summit?a. $100 millionb. $200 millionc. $300 milliond. $400 million

Step 1:First calculate the purchase consideration: Purchase consideration = Number of shares…

Answered: Summit Corp. has 20 million shares…

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 11MCQ

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Firm A is being acquired by Firm B for $62,000 worth of Firm B stock. The incremental value of the acquisition is $4,300. Firm A has 2,700 shares of stock outstanding at a price of $22 a share. Firm B has 10,400 shares of stock outstanding at a price of $31 a share. What is the actual cost of the acquisition using company stock?
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