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In 2019, Alliant Corporation acquired Centerpoint Inc. for $450 million, of which $70 million was allocated to goodwill. At the end of 2021, management has provided the following information for a required goodwill impairment test:

 

Fair value of Centerpoint Inc.	$	346	million
Book value of Centerpoint’s net assets (excluding goodwill)		310	million
Book value of Centerpoint’s net assets (including goodwill)		380	million

Required:
1. Determine the amount of the impairment loss. (Enter your answer in millions (i.e., 10,000,000 should be entered as 10)).

2. Determine the amount of the impairment loss assuming that the fair value of Centerpoint is $416 million. (Enter your answer in millions (i.e., 10,000,000 should be entered as 10)).

Answer 1

Req 1)

step 1) 346-310= 36 value of goodwill

step 2) 70-36= 34 impairment loss (answer)

Req 2)

since bv is 380 there is no impair loss cause 416>380