When Valley Co. acquired 80% of the common stock of Coleman Corp., Coleman owned land with a book value of $75,000 and a fair value of $125,000.What is the total amount of excess land allocation at the acquisition date?
A) $0.
B) $40,000.
C) $50,000.
D) $60,000.
E) $75,000.

Question

Quizplus · Accepted Answer

The excess land allocation is the difference between the fair value and the book value of the land, which is $125,000 - $75,000 = $50,000.