On January 2,2015,the Rambler Company purchased 40% of the outstanding common stock of the AMC Corporation for $2,000,000.AMC's net assets had a book value of $3,900,000 as of January 2,2015.AMC's buildings were undervalued by $350,000,their land was overvalued by $75,000,and their inventory was undervalued by $145,000.
Required:
Determine the amount of goodwill that Rambler acquired as a result of the AMC stock purchase.

Question

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The Answer of On January 2,2015,the Rambler Company purchased 40% of the outstanding common stock of the AMC Corporation for $2,000,000.AMC's net assets had a book value of $3,900,000 as of January 2,2015.AMC's buildings were undervalued by $350,000,their land was overvalued by $75,000,and their inventory was undervalued by $145,000.
Required:
Determine the amount of goodwill that Rambler acquired as a result of the AMC stock purchase.

On January 2,2015,the Rambler Company Purchased 40% of the Outstanding