Polypipe Company acquired 80% of Svedex Company's voting stock for $95,000 in cash. The noncontrolling interest...
Polypipe Company acquired 80% of Svedex Company's voting stock for $95,000 in cash. The noncontrolling interest had an estimated fair value of $20,000. Some of Svedex's identifiable assets and liabilities at the date of acquisition had fair values that were different from reported values, as follows:
|
Book Value |
Fair Value |
|
|
Property, net |
$ 6,000 |
$ 4,000 |
|
Licensing agreements |
1,000 |
25,000 |
Svedex's total shareholders' equity at the date of acquisition was
as follows:
|
Capital stock |
$5,000 |
|
Retained deficit |
(400) |
|
Treasury stock |
(50) |
|
Total |
$ 4,550 |
Total goodwill from this acquisition is:
|
A. |
88,450 |
|
|
B. |
$87,550 |
|
|
C. |
$68,450 | |
|
D. |
$84,450 |
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