REFERENCE: Ref.02_01
Bullen Inc.assumed 100% control over Vicker Inc.on January 1,20X1.The book value and fair value of Vicker's accounts on that date (prior to creating the combination)follow,along with the book value of Bullen's accounts:

-Assume that Bullen paid a total of $480,000 in cash for all of the shares of Vicker.In addition,Bullen paid $35,000 to a group of attorneys for their work in arranging the combination to be accounted for as a purchase.What will be the balance in consolidated goodwill?

Question

REFERENCE: Ref.02_01
Bullen Inc.assumed 100% control over Vicker Inc.on January 1,20X1.The book value and fair value of Vicker's accounts on that date (prior to creating the combination)follow,along with the book value of Bullen's accounts:
 
-Assume that Bullen paid a total of $480,000 in cash for all of the shares of Vicker.In addition,Bullen paid $35,000 to a group of attorneys for their work in arranging the combination to be accounted for as a purchase.What will be the balance in consolidated goodwill?

Quizplus · Accepted Answer

The calculation for consolidated goodwill is:

Consideration transferred ($480,000 + $35,000) - Fair value of net identifiable assets 
= ($515,000) - [$260,000 + ($120,000 + $90,000 + $20,000)] 
= $515,000 - $490,000 
= $25,000

Therefore, the balance in consolidated goodwill is $55,000 ($30,000 existing goodwill + $25,000 calculated goodwill). Answer choice D is correct.

REFERENCE: Ref.02_01 Bullen Inc.assumed 100% Control Over Vicker Inc.on January 1,20X1.The Book