Firm A purchased all the outstanding common shares of firm B for $300,000.Information about firm B follows: $\begin{array}{|l|l|l|}
\hline& \text { Book value } & \text { Market value } \
\hline \text { Total assets } & \$ 600,000 & \$ 800,000 \
\hline \text { Total liabilities } & 550,000 & 550,000\\hline
\end{array}$ How much will Firm A record as goodwill on this purchase?

Question

Firm A purchased all the outstanding common shares of firm B for $300,000.Information about firm B follows: $\begin{array}{|l|l|l|} 
\hline& \text { Book value } & \text { Market value } \
\hline \text { Total assets } & \$ 600,000 & \$ 800,000 \
\hline \text { Total liabilities } & 550,000 & 550,000\\hline
\end{array}$ How much will Firm A record as goodwill on this purchase?

Quizplus · Accepted Answer

The Answer of Firm A purchased all the outstanding common shares of firm B for $300,000.Information about firm B follows: $\begin{array}{|l|l|l|} 
\hline& \text { Book value } & \text { Market value } \
\hline \text { Total assets } & \$ 600,000 & \$ 800,000 \
\hline \text { Total liabilities } & 550,000 & 550,000\\hline
\end{array}$ How much will Firm A record as goodwill on this purchase?

Firm a Purchased All the Outstanding Common Shares of Firm