1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
lapo4ka [179]
2 years ago
5

You purchase another company for $50m. The company you purchase has assets with a fair value of $75m and liabilities with a fair

value of $30m. The amount of goodwill you would record in this transaction is:a. $45m b. $5m c. $50m d. $75m
Business
1 answer:
Crazy boy [7]2 years ago
5 0

Answer:

b. $5m

Explanation:

If we purchase another company for $50m and the company you purchase has assets with a fair value of $75m and liabilities with a fair value of $30m. The amount of goodwill we should record in this transaction is: $5m

Goodwill upon acquisition of companies is derived by subtracting the fair value of NET ASSETS from the TOTAL CONSIDERATION (i.e the price paid to acquire the company)

In the scenario, the value of Net Assets is the value of the fairvalue of the assets less the fair value of the liabilities which is $75 - $30 = $45

While the Total Consideration = $50

Therefore Goodwill = $50m - $45m = $5m

You might be interested in
Two types of value that are often contrasted are subjective value and: Group of answer choices A. inherent value B. reproduction
Ilia_Sergeevich [38]

Answer:

The correct answer is letter "C": objective value.

Explanation:

Subjective values are those provided by individuals based on their <em>beliefs, perceptions, ideas, feelings, </em>and <em>reflections</em>. Subjective values are biased. Objective values, on the other hand, are based on <em>facts, statistics, evidence, </em>and <em>observations</em>. Objective values are unbiased.

6 0
2 years ago
The mythical Hacker Microbrewery in Rosenheim, Germany, makes a brand of beer called Golden Eagle, which bottles and sells in ca
maw [93]

Answer:

Explanation:

Annual demand (D) = 20000 units

Number of days per year = 250

Demand rate(d) = D/number of days per year = 20000/250 = 80 units

Production rate(p) = 655 units

Set up cost(S) = $1800

Holding cost (H) = $1.50

A) Optimum run size(Q) = sqrt of {2DS / H [1-(d/p)]}

= sqrt of {(2x20000x1800) /1.50[1-(80/655)]}

= Sqrt of [7200000/1.50(1-0.1221) ]

= sqrt of [72000000/(1.50 x 0.8779)]

= sqrt of (7200000/1.31685)

= Sqrt of 5467593.1199

= 2338 units

b) Maximum inventory ( I - max) = (Q/p) (p-d) = (2338/655)(655-80) = 3.5695 x 575 = 2052.46 or rounded off to 2052 units

Average inventory = I-max/2 = 2052/2 = 1026 units

C) Number of production setups per year = D/Q = 20000/2338 = 8.55 or rounded up to 6

d) optimal length of production run  = optimal run size /production rate = 2338/655 = 3.56 or rounded up to 4 days

5 0
2 years ago
All of the following are expenses associated with home ownership that should be planned for early in the process except
grandymaker [24]
Mortgage payments are expenses associated with home ownership
7 0
2 years ago
The laffer curve makes the point that cutting a very high marginal tax rate can __________ the tax base enough so that tax reven
Ivenika [448]
<span>The laffer curve makes the point that cutting a very high marginal tax rate can raise the tax base enough so that tax revenues actually rise. The Laffer Curve is a theory that was developed by Arthur Laffer. The theory explains the relationship between tax rates and how much tax revue the government creates. </span>
8 0
3 years ago
Leslie Manufacturing reported the following:Revenue $450,000Beginning inventory of direct materials, January 1, 2015 20,000Purch
Bogdan [553]

Answer:

$109,000

Explanation:

The accounting equation for the cost of goods sold

COGS = opening finished good + purchases - Closing finished goods

In a manufacturing firm, purchases are also referred to as manufacturing costs.

For Leslie manufacturing:

beginning finished inventory =$40,000

costs of goods manufactured = $ 144,000

Ending finished inventory = $ 45,000

cost of  manufacturing for the period:

=$40,000 +$114,000- $45,000

=$109,000

5 0
3 years ago
Other questions:
  • The last element of a formal business letter should be the salutation followed by your signature.
    5·1 answer
  • Which of the following activities do marketers use as a way to lower product costs? A. Shop around for the best suppliers B. Off
    6·2 answers
  • Fremont Enterprises has an expected return of 18 % and Laurelhurst News has an expected return of 21 %. If you put 43 % of your
    14·1 answer
  • How is the standard of living measured?
    15·1 answer
  • There is always some degree of government involvement in a mixed economy.<br> O<br> True<br> O False
    11·2 answers
  • A project has a net present value of zero. Which one of the following best describes this project?The project has a zero percent
    5·1 answer
  • Walton Company paid $94,000 to purchase a machine on January 1, 2017. During 2019, a technological breakthrough resulted in the
    6·1 answer
  • What is 40 divided by 31
    8·2 answers
  • The U.S. government pays for _____ that producers would most likely not provide in the marketplace, such as building roads.
    13·2 answers
  • In which tab can you find features like New Slide, Slide Layout, and Reset Slide?
    8·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!