Pacific Company acquired Starz Company for $100 million and recognized $70 million in goodwill. Within a year after the acquisition, due to improvement in the economy Starz' land is worth $15 million more than the amount estimated at the date of acquisition.
How is this information reported?

Question

Quizplus · Accepted Answer

The value change is due to subsequent events and is therefore reported using normal accounting. Increases in the value of land are not reported.

Pacific Company Acquired Starz Company for $100 Million and Recognized