What is the amount of Goodwill included with Thomas Investment account
On January 1, 2020 Thomas acquires 40,000 shares representing 30% ownership of Wolf for $600,000 cash. Thomas will use the equity method.
At acquisition date, Wolf had a book value of assets of $700,000 and a book value of liabilities of $200,000. In addition, Wolf has a Building (remaining useful life of 15 years) with a book value of $500,000 and a fair value of $900,000 at January 1, 2020. All remaining assets and liabilities of Wolf had book value equal to fair value at date of acquisition.
What is the amount of
Given:
Rate of ownership = 30 %
Price of share = $ 600,000
Assets book value = $ 700,000
Liabilities book value = $ 200,000
Book value = $ 500,000
Fair value = $ 900,000
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