Wilkins Inc. acquired 100% of the voting common stock of Granger Inc. on January 1, 2021. The book value and fair value of Granger's accounts on that date (prior to creating the combination) are as follows, along with the book value of Wilkins's accounts: Retained earnings, 1/1/21 Cash and receivables Inventory Land Buildings (net) Equipment (net) Liabilities Common stock Additional paid-in capital Wilkins Book Value Granger Book Value $250,000 $240,000 170,000 70,000 $70,000 230,000 180,000 210,000 320,000 220,000 240,000 280,000 480,000 240,000 120,000 90,000 90,000 Granger Fair Value 650,000 440,000 430,000 80,000 40,000 360,000 60,000 Assume that Wilkins issued 13,000 shares of common stock, with a $5 par value and a $46 fair value, to obtain all of Granger's outstanding stock. In this acquisition transaction, how much goodwill should be recognized?
Wilkins Inc. acquired 100% of the voting common stock of Granger Inc. on January 1, 2021. The book value and fair value of Granger's accounts on that date (prior to creating the combination) are as follows, along with the book value of Wilkins's accounts: Retained earnings, 1/1/21 Cash and receivables Inventory Land Buildings (net) Equipment (net) Liabilities Common stock Additional paid-in capital Wilkins Book Value Granger Book Value $250,000 $240,000 170,000 70,000 $70,000 230,000 180,000 210,000 320,000 220,000 240,000 280,000 480,000 240,000 120,000 90,000 90,000 Granger Fair Value 650,000 440,000 430,000 80,000 40,000 360,000 60,000 Assume that Wilkins issued 13,000 shares of common stock, with a $5 par value and a $46 fair value, to obtain all of Granger's outstanding stock. In this acquisition transaction, how much goodwill should be recognized?
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:Wilkins Inc. acquired 100% of the voting common stock of Granger Inc. on January 1, 2021. The book value and fair value of Granger's accounts on that date (prior to creating the combination) are as
follows, along with the book value of Wilkins's accounts:
Retained earnings, 1/1/21
Cash and receivables
Inventory
Land
Buildings (net)
Equipment (net)
Liabilities
Common stock
Additional paid-in capital
Granger
Fair
Value
Wilkins
Book
Value
Granger
Book
Value
$250,000 $240,000
170,000
70,000
$ 70,000
230,000 180,000
210,000
320,000 220,000 240,000
480,000 240,000
280,000
120,000
90,000
90,000
650,000 440,000
430,000
360,000
80,000
60,000
40,000
Assume that Wilkins issued 13,000 shares of common stock, with a $5 par value and a $46 fair value, to obtain all of Granger's outstanding stock. In this acquisition transaction, how much goodwill
should be recognized?
Transcribed Image Text:Multiple Choice
$178,000.
$138,000.
$98,000.
$94,000.
$0.
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