Paster Corporation was seeking to expand its customer base, and wanted to acquire a company in a market area it had not yet served. Paster determined that the Semma Company was already in the market they were pursuing, and on January 1, 2013, purchased a 25% interest in Semma to assure access to Semma's customer base. Paster paid $800,000, at a time when the book value of Semma's net equity was $3,000,000. Semma's book values equaled their fair values except for the following items:
Required:
Prepare a schedule to allocate any excess purchase cost to identifiable assets and goodwill.

Question

Paster Corporation was seeking to expand its customer base, and wanted to acquire a company in a market area it had not yet served. Paster determined that the Semma Company was already in the market they were pursuing, and on January 1, 2013, purchased a 25% interest in Semma to assure access to Semma's customer base. Paster paid $800,000, at a time when the book value of Semma's net equity was $3,000,000. Semma's book values equaled their fair values except for the following items:
  Required:
Prepare a schedule to allocate any excess purchase cost to identifiable assets and goodwill.

Quizplus · Accepted Answer

The Answer of Paster Corporation was seeking to expand its customer base, and wanted to acquire a company in a market area it had not yet served. Paster determined that the Semma Company was already in the market they were pursuing, and on January 1, 2013, purchased a 25% interest in Semma to assure access to Semma's customer base. Paster paid $800,000, at a time when the book value of Semma's net equity was $3,000,000. Semma's book values equaled their fair values except for the following items:
  Required:
Prepare a schedule to allocate any excess purchase cost to identifiable assets and goodwill.

Paster Corporation Was Seeking to Expand Its Customer Base, and Wanted