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Big Co. acquired 100% of Little Co. on 1/1/X9 for $1,000,000 cash. At that time, book value equaled fair value for all balanc

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Answer #1
Book value Fair value Excess fair value of assets
Inventory 75000 95000 20000
Bond payable 100000 125000 -25000
Land 40000 55000 15000
Excess Fair value of assets 10000

Correct answer is

4. $ 10,000

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