On luly 1, 2017, Vinson Corporation acquired Carlev Company for $900,000 cash. At the time of purchase, Carley's balance sheet showed assets of $775,000 and liabilities of $250,000. The fair value of Carley's assets is estimated to be $950,000 and the fair value of liabilities is estimated to be $250,000. Instructions - Show all work. la) Compute the amount of goodwill acauired bv Vinson. (b) On December 31, the fair value of Carlev is estimated to be $720,000 and the carrying value of Carlev's net assets, including the goodwill, at year-end is $750,000. In addition, it is determined on December 31 that Inventory is understated by $50,000 and Equipment is overstated by $25,000. Prepare Vinson's journal entry, if necessary, to record impairment of goodwill.

On luly 1, 2017, Vinson Corporation acquired Carlev Company for $900,000 cash. At the time of purchase, Carley's balance sheet showed assets of $775,000 and liabilities of $250,000. The fair value of Carley's assets is estimated to be $950,000 and the fair value of liabilities is estimated to be $250,000. Instructions - Show all work. la) Compute the amount of goodwill acauired bv Vinson. (b) On December 31, the fair value of Carlev is estimated to be $720,000 and the carrying value of Carlev's net assets, including the goodwill, at year-end is $750,000. In addition, it is determined on December 31 that Inventory is understated by $50,000 and Equipment is overstated by $25,000. Prepare Vinson's journal entry, if necessary, to record impairment of goodwill.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 11PB: On May 1, 2015, Zoe Inc. purchased Branta Corp. for $15,000,000 in cash. They only received...

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