Goodwill arises when one firm acquires the net assets of another firm and pays more for...

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Goodwill arises when one firm acquires the net assets of another firm and pays more for those net assets than their current f

b. Calculate the ROI for Target Co, based on its present operating income and the fair value of its net assets. (Round your p

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Answer 1

Answer #1


a.	Goodwill	$131,000
	($336,000 - $205,000)


b.	ROI	28.54%
	(Operating Income/Net operating assets)
	($58,500/$205,000)


c.	ROI	17.41%
	($58,500/$336,000)

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Answer 2

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Goodwill arises when one firm acquires the net assets of another firm and pays more for...

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