Question

P1-33 Goodwill Assigned to Multiple Reporting Units The fair values of assets and liabilities held by three reporting units and other information related to the reporting units owned by Prover Company are as follows: Reporting Unit Cash & Receivables Inventory Land Buildings Equipment Accounts Payable Fair Value of Reporting Unit Carrying Value of Investment Goodwill Included in Carrying Value $ 30,000 60,000 20,000 100,000 140.000 40,000 400,000 420,000 70,000 $ 80,000 100,000 30,000 150,000 90,000 60,000 440,000 500,000 50,000 $ 20,000 40,000 10,000 80,000 50,000 10,000 265,000 290,000 40,000 Required a. Determine the amount, if any, that Prover should report as a goodwill impairment for the current period. b. Determine the amount of goodwill that Prover should report in its current financial statements.

Answer question (b), do not copy others answer.

(b) Determine the amount of goodwill that prover should report in its current financial statement.

Answer 1

Ans.(b). Goodwill to be reported in the current financial statements is-

	A	B	C	Total
Implied value of Goodwill at year-end	90,000	50,000	75,000	215,000
Carrying value of Goodwill	70,000	50,000	40,000	160,000
Goodwill to be reported at year-end	160,000	100,000	115,000	375,000