When a Company A purchases Company B at a cost that is greater than the book...
When a Company A purchases Company B at a cost that is greater than the book value of Company B’s net assets, the amount is known as:
Select one:
a. Intangible assets
b. Benevolence
c. Intellectual property
d. Goodwill
Homework Answers
Correct answer-----------d. Goodwill
Working note
Goodwill arises when the amount paid for purchase of business is more than the book value of assets of the business purchased, In above case Company A has paid more than Book valuer of assets of Company A. Goodwill is an intangible asset which will be recorded in books of Company A.
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When a Company A purchases Company B at a cost that is greater
than the book...
Ivanhoe Company purchases Miles Company for $3700000 cash on January 1, 2018. The book value of...
Ivanhoe Company purchases Miles Company for $3700000 cash on
January 1, 2018. The book value of Miles Company's net assets
reported on its December 31, 2017 financial statement was $3100000.
An analysis indicated that the fair value of Miles's tangible
assets exceeded the book value by $500000, and the fair value of
identifiable intangible assets exceeded book value by $270000. What
amount of gain or goodwill is recognized by Ivanhoe?
$770000 gain.
$500000 goodwill.
$170000 gain.
$170000 goodwill.
An asset is classified as goodwill on the balance sheet when a company purchases an asset at greater than fair-market value.
QUESTION 10 / 11 An asset is classified as goodwill on the balance sheet when a company purchases an asset at greater than fair-market value. According to GAAP, you can adjust goodwill when ______________SELECT ONLY ONE an asset is sold stock prices go down a new asset is purchased stock prices go up goodwill is impaired
Company Y is purchased by Company X, at an acquisition cost that is $100,000 greater than...
Company Y is purchased by Company X, at an acquisition cost that is $100,000 greater than the fair value of the identifiable net assets acquired. One of the assets acquired is a building, originally valued at $37,000 at the date of the purchase. Six months after the acquisition, it is discovered that the building was really only worth $25,000 at the date of acquisition. What entry is made to reflect this new information? a. A debit of $12,000 to Loss...
Sheetz Company is purchased by Pulsar Corporation, at an acquisition cost that is $25,000,000 greater than...
Sheetz Company is purchased by Pulsar Corporation, at an acquisition cost that is $25,000,000 greater than the fair value of the identifiable net assets acquired. One of the assets acquired is a building, originally valued at $15,000,000 at the date of the purchase. Six months after the acquisition, it is discovered that the building was actually worth $7,000,000 at the date of acquisition. What entry is made to reflect this new information? Question 20 options: a) Dr. goodwill; Cr. building...
Consolidation at date of acquisition (purchase price greater than book value, acquisition journal entries Assume that...
Consolidation at date of acquisition (purchase price greater than book value, acquisition journal entries Assume that the parent company acquires its subsidiary by exchanging 84,000 shares of its $2 par value Common Stock, with a fair value on the acquisition date of $41 per share, for all of the outstanding voting shares of the investee. In its analysis of the investee company, the parent values all of the subsidiary’s assets and liabilities at an amount equaling their book values except...
1. In 2013, Book Creations Company published a management book and got it copyrighted in the...
1. In 2013, Book Creations Company published a management book and got it copyrighted in the same year. The legal life of the book is 15 years and estimated useful life is 10 years. For how many years should the cost of copyright be amortized? Question 1 options: a. 70 years b. 15 years c. 10 years d. 12.5 years e. 0 year 2.Kremlin Company pays $2,900,000 for all of the outstanding common stock of Reticular Corporation. Reticular has assets...
The cost of intangible assets of an intellectual nature is composed primarily of: Select one: a....
The cost of intangible assets of an intellectual nature is composed primarily of: Select one: a. Legal fees and the purchase price to obtain rights from a second party b. Cerebral material c. Real property d. Scholarly books
1. The Charleston Company purchases a machine on 1/1/18: The book value at 12/31/20 will be:...
1.
The Charleston Company purchases a machine on 1/1/18:
The book value at 12/31/20 will be:
Select one:
a. $16,250
b. $19,750
c. $17,000
d. $13,750
e. $22,500
2.
Given the following data:
Net Income is:
Select one:
a. Overstated $24
b. Understated $6
c. Overstated $16
d. Understated $15
e. Understated $14
3.
The Bozeman Company had current assets of $500 and current
liabilities of $400 prior to the following transactions:
1. Collection of an account receivable, $100
2....
Answer the follow accounting questions:1. Expenditures that are recorded as expenses when incurred arecalled:...
Answer the follow accounting questions:1. Expenditures that are recorded as expenses when incurred are called:a)Capital ExpendituresB) REvenue expendituresC)research and development costsD)intangible expensitures2)Expenditures for Plant Assets that will be used by a company for more than one year are termed:a)Capital ExpendituresB) REvenue expendituresC)research and development costsD)intangible expensitures3. Tangible property intended to b e used by a company for more than one year would be labeled asa)Capital ExpendituresB) REvenue expendituresC)research and development costsD)intangible expensitures4. To adjust the value of a planet asset,...
21) Which of the following t h earlier years than in later years! A) the double-declining...
21) Which of the following t h earlier years than in later years! A) the double-declining balance method C) the units-of-production method e cales a higher amount of depreciation in game 27) D) the first in first- w hed 28) A fully depreciated plant asset A) is no longer reported on the balance sheet B) can no longer be used in the business C) is removed from the counting records D) can be discarded, sold or exchanged for another plant...
Ivanhoe Company purchases Miles Company for $3700000 cash on
January 1, 2018. The book value of Miles Company's net assets
reported on its December 31, 2017 financial statement was $3100000.
An analysis indicated that the fair value of Miles's tangible
assets exceeded the book value by $500000, and the fair value of
identifiable intangible assets exceeded book value by $270000. What
amount of gain or goodwill is recognized by Ivanhoe?
$770000 gain.
$500000 goodwill.
$170000 gain.
$170000 goodwill.
1.
The Charleston Company purchases a machine on 1/1/18:
The book value at 12/31/20 will be:
Select one:
a. $16,250
b. $19,750
c. $17,000
d. $13,750
e. $22,500
2.
Given the following data:
Net Income is:
Select one:
a. Overstated $24
b. Understated $6
c. Overstated $16
d. Understated $15
e. Understated $14
3.
The Bozeman Company had current assets of $500 and current
liabilities of $400 prior to the following transactions:
1. Collection of an account receivable, $100
2....
21) Which of the following t h earlier years than in later years! A) the double-declining balance method C) the units-of-production method e cales a higher amount of depreciation in game 27) D) the first in first- w hed 28) A fully depreciated plant asset A) is no longer reported on the balance sheet B) can no longer be used in the business C) is removed from the counting records D) can be discarded, sold or exchanged for another plant...
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