Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company. To provide: Goodwill Impairment

Question

Anton Company acquired the net assets of Hair Company on January 1, 2015, for $600,000. Using a business valuation model, the estimated value of Anton Company was $650,000 immediately after the acquisition. The fair value of Anton’s net assets was $400,000. 1. What amount of goodwill was recorded by Anton Company when it acquired Hair Company?2. Using the information, answer the questions posed in the following two independent situations: a. On December 31, 2016, there were indications that goodwill might have been impaired. At that time, the existing recorded book value of Anton Company’s net assets, including goodwill, was $500,000. The fair value of the net assets, exclusive of goodwill, was estimated to be $340,000. The value of the business was estimated to be $520,000. Is goodwill impaired? If so, what adjustment is needed? b. On December 31, 2018, there were indications that goodwill might have been impaired. At that time, the existing recorded book value of Anton Company’s net…

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Question

Chapter 1, Problem 9.2E

a.

To determine

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment

b.

To determine

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment

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Anton Company acquired the net assets of Hair Company on January 1, 2015, for $600,000. Using a business valuation model, the estimated value of Anton Company was $650,000 immediately after the acquisition. The fair value of Anton’s net assets was $400,000. 1. What amount of goodwill was recorded by Anton Company when it acquired Hair Company?2. Using the information, answer the questions posed in the following two independent situations: a. On December 31, 2016, there were indications that goodwill might have been impaired. At that time, the existing recorded book value of Anton Company’s net assets, including goodwill, was $500,000. The fair value of the net assets, exclusive of goodwill, was estimated to be $340,000. The value of the business was estimated to be $520,000. Is goodwill impaired? If so, what adjustment is needed? b. On December 31, 2018, there were indications that goodwill might have been impaired. At that time, the existing recorded book value of Anton Company’s net…

On August 1, 2017, Riverbed Corporation acquired Marin, Inc. for a cash payment of $2.30 million. At the time of purchase, Marin’s balance sheet showed assets of $4,422,000, liabilities of $2,622,000, and owners’ equity of $1,800,000. The fair value of Marin’s identifiable assets is estimated to be $4,330,000.Compute the amount of goodwill acquired by Riverbed.

In January 1, 2015, Fun company purchased Company A for $40,000 in cash and paid immediately. Fun company assumed all of Company A's assets and assumed Company A's liabilities. company A has assets valued at $60,000 and liabilities valued at $50,000. question: in 2016, fun company must test for the impairment of goodwill. Assume the only goodwill on fun company's books is from the acquisition of company A. Fun company determined that the goodwill has an estimated future cash flow of $25,000 and a fair market value of $20,000. Does fun company have to recognize an impairment? Why or why not? If an impairment must be recognized, compute the impairment loss and record the journal entry.

Answer 2

Question

Chapter 1, Problem 9.2E

a.

To determine

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment

b.

To determine

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment

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Answer 3

Question

Chapter 1, Problem 9.2E

a.

To determine

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment

b.

To determine

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment

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Answer 4

Question

Chapter 1, Problem 9.2E

a.

To determine

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment

b.

To determine

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment

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Answer 5

Chapter 1, Problem 9.2E

a.

To determine

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment

b.

To determine

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment

Answer 6

Chapter 1, Problem 9.2E

a.

To determine

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment

Answer 7

Chapter 1, Problem 9.2E

a.

To determine

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment

Answer 8

b.

To determine

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment

Answer 9

b.

To determine

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment

Answer 10

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Ch. 1 - Prob. 1UTI Ch. 1 - Prob. 3UTI Ch. 1 - Prob. 4UTI Ch. 1 - Prob. 5UTI Ch. 1 - Prob. 6UTI Ch. 1 - Prob. 7UTI Ch. 1 - Prob. 8UTI Ch. 1 - Prob. 9UTI Ch. 1 - Prob. 10UTI Ch. 1 - Prob. 1.1E

Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company. To provide: Goodwill Impairment

Solution Summary: The author explains that acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

Concept explainers

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment

Chapter 1 Solutions

Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company. To provide: Goodwill Impairment

Solution Summary: The author explains that acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

Concept explainers

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company. To provide: Goodwill Impairment

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company. To provide: Goodwill Impairment

Chapter 1 Solutions

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment

Introduction: Acquisition is a corporate term used to represent purchase of another company and gaining the ownership of the company.

To provide: Goodwill Impairment