Answer:
b. $20,000
Explanation:
Goodwill = Investment in Subsidiary - (Asset With book value - Liability with book value) - (Fair value of Asset - Book value of Asset)
Goodwill = $95,000 - ($86,400 - $15,000) - ($90,000 - $86,400)
Goodwill = $95,000 - $71,400 - $3,600
Goodwill = $20,000
So, parent should record goodwill on this purchase of $20,000
Answer:
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Answer:
$70
Explanation:
Total revenue from three employees:
= No. of gallons of paint produced × Selling price per gallon
= 40 × $15
= $600
Total revenue from four employees:
= No. of gallons of paint produced × Selling price per gallon
= 48 × $15
= $720
Total revenue created by 4th worker:
= Total revenue from four employees - Total revenue from three employees
= $720 - $600
= $120
Cost of hiring 4th worker = $50 per day
Therefore,
Marginal profit for the fourth employee:
= Total revenue created by 4th worker - Cost of hiring 4th worker
= $120 - $50
= $70