Cheyenne Corporation purchased Sage Hill Company 3 years ago and at that time recorded goodwill of $320,000. The Sage Hill Division’s net assets, including the goodwill, have a carrying amount of $640,000. The fair value of the division is estimated to be $840,000. Prepare Cheyennes' journal entry, if necessary, to record impairment of the goodwill.

Cheyenne Corporation purchased Sage Hill Company 3 years ago and at that time recorded goodwill of $320,000. The Sage Hill Division’s net assets, including the goodwill, have a carrying amount of $640,000. The fair value of the division is estimated to be $840,000. Prepare Cheyennes' journal entry, if necessary, to record impairment of the goodwill.

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter10: Cost Recovery On Property: Depreciation, Depletion, And Amortization

Section: Chapter Questions

Problem 21P

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