Intermediate Accounting (2nd Edition)
2nd Edition
ISBN: 9780134730370
Author: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
Publisher: PEARSON
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Question
Chapter 11, Problem 11.17BE
To determine
The amount of goodwill or gain from bargain purchase and the head to record it in income statement.
Given information
Book value of the assets is $7,000,000.
Amount by which assets were undervalued is $1,000,000.
Acquisition price is $12,000,000.
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On September 1, 20Y8, Vernon Corporation acquired Barlow Enterprises for a cash payment of $2,300,000. At the time of acquisition, Barlow's balance sheet showed assets of $1,800,000, liabilities of $600,000, and owner's equity of $1,200,000. A recent appraisal indicated that the fair value of Barlow's assets is estimated to be $2,100,000.
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Chapter 11 Solutions
Intermediate Accounting (2nd Edition)
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