Ch 2: Consolidation of Financial Information ACCT 501, SP 12 1.Example 1: Purchase Price > Fair Value (Subsidiary Dissolved) Required:using the acquisition method, 1)How much goodwill should be recognized? Acquisition cost $25,000,000. Book value of Sugar (5,300,000)Cost in excess of Sugar's book value $19,700,000. Differences between fair value and book value: Current assets $ (300,000) Plant and equipment, net 10,000,000. Patents and copyrights 4,000,000. Brand names 1,000,000. Favorable lease agreements 600,000. Contractual customer relationships 3,000,000. Long-term debt (2,000,000)16,300,000. Goodwill $ 3,400,000.
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