On January 2,2008,Heinreich Co.paid $500,000 for 25% of the voting common stock of Jones Corp.At the time of the investment,Jones had net assets with a book value and fair value of $1,800,000.During 2008,Jones incurred a net loss of $60,000 and paid dividends of $100,000.Any excess cost over book value is attributable to goodwill with an indefinite life.
Required:
1)Prepare a schedule to show the amount of goodwill from Heinrich's investment in Jones.
2)Prepare a schedule to show the balance in Heinreich's investment account at December 31,2008.

Question

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The Answer of On January 2,2008,Heinreich Co.paid $500,000 for 25% of the voting common stock of Jones Corp.At the time of the investment,Jones had net assets with a book value and fair value of $1,800,000.During 2008,Jones incurred a net loss of $60,000 and paid dividends of $100,000.Any excess cost over book value is attributable to goodwill with an indefinite life.
Required:
1)Prepare a schedule to show the amount of goodwill from Heinrich's investment in Jones.
2)Prepare a schedule to show the balance in Heinreich's investment account at December 31,2008.