Gongman Corp. owned the following assets when it came out of a Chapter 11 bankruptcy: Gongman Corp. had a fresh start reorganization value of $1,000,000. What amount of goodwill should have been recognized in recording the reorganization?

Question

Gongman Corp. owned the following assets when it came out of a Chapter 11 bankruptcy:  Gongman Corp. had a fresh start reorganization value of $1,000,000. What amount of goodwill should have been recognized in recording the reorganization?

Quizplus · Accepted Answer

Reorganization Value $1,000,000 - Identifiable FV of Assets ($160,000 + $150,000 + $340,000 + $250,000) $900,000 = Unidentifiable FV $100,000 (i.e., Goodwill)