Use the following information for questions 1 - 4. Pursuing an inorganic growth strategy, Wilson Company acquired Venus Company's net assets and assigned them to four separate reporting divisions. Wilson assigned total goodwill of $134,000 to the four reporting divisions as given below Alpha Beta Gamma Delta Carrying value $200,000 $320,000 $370,000 $300,000 Goodwill included in carrying value 20,000 34,000 50,000 30,000 Fair value of net identifiable assets at year-end 150,000 300,000 290,000 280,000 Fair value of reporting unit at year-end 210,000 350,000 300,000 285,000 1. Based on the preceding information, what amount of goodwill will be reported for Alpha at year-end? $30,000 $10,000 $0 $20,000 QUESTION 3 2. Based on the preceding information, what amount of goodwill will be reported for Beta at year-end? $34,000 $0 $50,000 $14,000 QUESTION 4 3. Based on the preceding information, for Gamma: goodwill impairment of $70,000 should be recognized at year-end. goodwill impairment of $60,000 should be recognized at year-end. goodwill of $50,000 should be reported at year-end. no goodwill should be reported at year-end. QUESTION 5 Based on the preceding information, for Delta: goodwill of $30,000 should be reported at year-end. goodwill impairment of $15,000 should be recognized at year-end. goodwill impairment of $20,000 should be recognized at year-end. no goodwill should be reported at year-end.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Use the following information for questions 1 - 4.

Pursuing an inorganic growth strategy, Wilson Company acquired Venus Company's net assets and assigned them to four separate reporting divisions. Wilson assigned total goodwill of $134,000 to the four reporting divisions as given below

	Alpha	Beta	Gamma	Delta
Carrying value	$200,000	$320,000	$370,000	$300,000
Goodwill included in carrying value	20,000	34,000	50,000	30,000
Fair value of net identifiable assets at year-end	150,000	300,000	290,000	280,000
Fair value of reporting unit at year-end	210,000	350,000	300,000	285,000

1. Based on the preceding information, what amount of goodwill will be reported for Alpha at year-end?

		$30,000
		$10,000
		$0
		$20,000

QUESTION 3

2. Based on the preceding information, what amount of goodwill will be reported for Beta at year-end?

$34,000

$0

$50,000

$14,000

QUESTION 4

3. Based on the preceding information, for Gamma:

		goodwill impairment of $70,000 should be recognized at year-end.
		goodwill impairment of $60,000 should be recognized at year-end.
		goodwill of $50,000 should be reported at year-end.
		no goodwill should be reported at year-end.

QUESTION 5

Based on the preceding information, for Delta:

		goodwill of $30,000 should be reported at year-end.
		goodwill impairment of $15,000 should be recognized at year-end.
		goodwill impairment of $20,000 should be recognized at year-end.
		no goodwill should be reported at year-end.

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