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BE 12-7 Waters corporation purchased Johnson Company 3 years ago and at that time recorded gooswill of $400,000.

BE 12-7 Waters corporation purchased Johnson Company 3 years ago and at that time recorded gooswill of $400,000. The johnson Division's net assers, including the goodwill have a carrying amount of $800,000. The fair value of the division is estimated to be $1,000,000.


I have to answer the following. BE 12-8 Use the information provided in BE 12-7. Assume that the fair value of the division is estimated to be $750,000 and the implied goodwill is $350,000. Prepare Water's journal entry, if necessary, to record impairment of the goodwill.

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