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11111nata11111 [884]
3 years ago
14

The balance sheet of Subsidiary shows assets of $86,400 and liabilities of $15,000. The fair value of the assets is $90,000 and

the fair value of its liabilities is $15,000. Parent paid $95,000 to acquire Subsidiary. Parent should record goodwill on this purchase of:______.
A) $23,600.
B) $20,000.
C) $3,600.
D) $5,000.
Business
1 answer:
Andrews [41]3 years ago
8 0

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

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A firm sells 2000 units at £500 each. If fixed costs are £50,000 and variable costs are £100 per unit, calculate the total costs
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Explanation:

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7 0
2 years ago
Royal Dutch Shell(RDS) acquires ethanol fuel from Brazilian Cosan energy company. The Ethanol costs 500 million Brazilian Real(B
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Explanation:

Solution

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Nowm,

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3 0
3 years ago
Equilibrium price is $10 in a perfectly competitive market. For a perfectly competitive firm, MR = MC at 233 units of output. At
Anika [276]

Answer:

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Explanation:

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