On January 1, 20Y3, The Simmons Group, Inc., purchased the assets of NWS Insurance Co. for $40,610,000, a price reflecting an $4,061,000 goodwill premium. On December 31, 20Y9, The Simmons Group determined that the goodwill from the NWS acquisition was impaired and had a value of only $1,522,875. Determine the book value of the goodwill on December 31, 20Y9, prior to making the impairment adjustment.
Q: ) Prepare the journal entry to account for any impairment of goodwill. b) Assume instead that at…
A: Goodwill: Goodwill is an intangible asset. It is defined as the excess of cost of an acquired…
Q: Robinson Company purchased Franklin Company at a price of $2,500,000. The fair market value of…
A: Given information is: Robinson Company purchased Franklin Company at a price of $2,500,000. The…
Q: amount should be reported as goodwill
A: Goodwill should be recognized as an intangible asset if money or money's worth has been paid for it.…
Q: Tyra Company acquired all of Jay Corporation's assets and liabilities on June 30, 2021. Jay reported…
A: An acquisition is when one company purchases all or most of another company's shares to gain control…
Q: Sheffield Corporation purchased Sage Hill Company 3 years ago and at that time recorded goodwill of…
A: Impairment of loss: The impairment loss must be recorded so that the asset is written down. There is…
Q: Several years ago, Blaha Company purchased Husker Company as a subsidiary. At that time, Blaha…
A: Impairment of goodwill When the carrying value of goodwill on financial statements exceeds its…
Q: Waters Corporation purchased Johnson Company 3 years ago and at that time recorded goodwill of…
A: Goodwill: Goodwill is an intangible asset. Goodwill is a reputation of a business which cannot be…
Q: Waters Corporation purchased Johnson Company 3 years ago and at that time recorded goodwill of…
A: Goodwill: Goodwill is an intangible asset. Goodwill is a reputation of a business which cannot be…
Q: WebHelper Inc. acquired 100% of the outstanding stock of Silicon Chips Corporation (SCC) for $46.1…
A: Goodwill is determined as an excess of the cost of a company acquired over the fair value of its net…
Q: In 2021, Dooling Corporation acquired Oxford Company for $250 million, of which $50 million was…
A: As per IAS -36 "Impairment of Assets" - impairment loss needs to be recognized, when the book value…
Q: On January 1, 2021, Globe Company sold a piece of machinery to Troll Company for P2,400,000. Because…
A: Lease liability is the present value of lease payments to be made by lessee over the lease term by…
Q: In 2014, Alliant Corporation acquired Centerpoint Inc. for $300 million, of which $50 million was…
A:
Q: In 2019, Alliant Corporation acquired Centerpoint Inc. for $300 million, of which $50 million was…
A: Goodwill: Goodwill is an intangible asset. It is defined as the excess of cost of an acquired…
Q: On January 1, 2024, Jackson purchased ABC Company for $900,000. At the time, ABC Company had assets…
A: In case of analysis of valency it is important to understand the assets value and liabilities value…
Q: WebHelper Inc. acquired 100% of the outstanding stock of Silicon Chips Corporation (SCC) for $45…
A: Goodwill is determined as an excess of the cost of a company acquired over the fair value of its net…
Q: On December 31, 20x1, an entity classified a building with an original cost of P20,000,000, carrying…
A: SOLUTION NOTE = IF THE COMPANY ADOPTS THE COST MODEL OF MEASURING PROPERTY,PLANT & EQUIPMENT…
Q: Cheyenne Corporation purchased Sage Hill Company 3 years ago and at that time recorded goodwill of…
A: Loss on impairment = Carrying value of goodwill - Fair value of goodwill
Q: On January 1, 2021 Major acquired 60% of Minor for a cash payment of $600,000. At date of…
A: Formula: Goodwill = Purchase price - Fair value of Net Assets
Q: purchased Y Company at a cost that resulted In recognition of goodwill at 10 million having an…
A: there are two types of assets one of them is intangible assets and other is tangible assets.…
Q: Ayayai Corporation purchased Kingbird Company 3 years ago and at that time recorded goodwill of…
A: Implied value of Goodwill = Fair value of Division- Fair value of Kingbird Division’s net assets…
Q: On January 1, 2011, Barbidel Company purchased another entity at a cost of P9,000,000. The net…
A: Amount of Goodwill on January 1, 2011 = Purchase costs - fair value of net assets = P9,000,000 -…
Q: On luly 1, 2017, Vinson Corporation acquired Carlev Company for $900,000 cash. At the time of…
A: Goodwill: Goodwill is the good reputation developed by a company over years. This is recorded as an…
Q: n 2019, Alliant Corporation acquired Centerpoint Inc. for $300 million, of which $50 million was…
A: Impairment Loss - It refers to the decrease in the value of long-lived assets due to obsolescence,…
Q: in 2019, Alliant Corporation acquired Centerpoint Inc. for $390 million, of which $60 million was…
A: The impairment loss is decrease in carrying value to present assets at their fair value.
Q: n January 1, 2018, Paye Company purchased Che Company at a cost that resulted in recognition of…
A: solution : let us analyse the given question first: On January 1, 2018, Paye Company purchased Che…
Q: In 2019, Alliant Corporation acquired Centerpoint Inc. for $300 million, of which $50 million was…
A: Impairment loss refers to a decrease in the company's asset value permanently, usually in fixed and…
Q: On January 1, 20X9, Planet Corporation sold equipment for $400,000 to Star Corporation, its wholly…
A: Solution: Depreciation for 20X9 = (Cost - Salvage value) / useful life = ($900,000 - $50,000) / 10…
Q: On April 23, 2020, Charming Company classified a noncurrent asset held for sale in accordance with…
A: Non-current assets are the one which are available with the owner for more than 5 years and are…
Q: On May 1, 2021, Jazzie Co. agreed to sell the assets of its Mister Division to Shawna Inc. for $80…
A: Particulars Amount in Millions a) Pre-tax loss from discontinued operations (10) b) Loss…
Q: n July 16, 2020, Agony Company classified a noncurrent asset as held for sale in accordance with…
A: As per IFRS 5, Non Current Assets Held for Sale and Discontinued Operations, at the time of…
Q: WebHelper Inc. acquired 100% of the outstanding stock of Silicon Chips Corporation (SCC) for $45…
A: Goodwill:Goodwill is an intangible asset. It is defined as the excess of cost of an acquired company…
Q: On January 1, 20X1, XYZ, Inc. purchased 70% of Set Corporation for $469,000. On that date the book…
A: Income from subsidiary in net income: Purchased 70 % of set corporation. Net income of $ 100000
Q: -On July 1, 2019, Captain Company paid $3,000,000 for all of the common stock of Bright Sunshine,…
A: Impairment expenditure is an accounting expenditure that is recognised when a durable decrease in…
Q: Xtra Company purchased a business from Argus for $96,000 above the fair value of its net assets…
A: Goodwill is classified as an intangible asset on the balance sheet. Under US GAAP and IFRS, goodwill…
Q: Del Luna Corporation concluded that the fair value of Scarlet Company was P160,000 and paid that…
A: Goodwill is refereed as the reputation of the business which is an intangibles asset that does not…
Q: Waters Corporation purchased Johnson Company 3 years ago and at that time recorded goodwill of…
A: Intangible Assets: These are the long-term assets having no physical existence. However, the…
Q: Del Luna Corporation concluded that the fair value of Scarlet Company was P160,000 and paid that…
A: Goodwill: Goodwill is an intangible asset. It is defined as the excess of cost of an acquired…
Q: Floyd Company purchases Haeger Company for $800,000cash on January 1, 2011. The book value of Haeger…
A: Consolidation: It can be defined as the process of merging or combining various smaller businesses…
Q: On March 1, 2010, JJ Corporation acquired for P 5,600,000 all of the assets of ZZ Company. On this…
A: The goodwill is calculated by deducting the fair value of the assets from the acquisition price.
Q: Manara Corporation acquired Sama Products on January 1, 2019 for $4,000,000, and recorded goodwill…
A: Intangible assets include: Goodwill Patent Copyright Trademark
Q: ABC Company acquired all of XYZ Corporation's assets and liabilities on June 30, 20X1. XYZ reported…
A: Book value and fair value Book value is based on the original old purchase price where annual…
Q: Goodwill Impairment On January 1, 20Y3, The Simmons Group, Inc., purchased the assets of NWS…
A: Impairment of Goodwill: The term 'Impairment' simply means deterioration in the value of the…
Q: On June 30, 2020, Happee Inc. purchased goodwill of P125,000 when it acquired the net assets of Beam…
A: Given, Goodwill acquired along with Net assets = P 125,000 Developed Goodwill costs: Training…
Q: Wildhorse Corporation acquired End-of-the-World Products on January 1, 2020 for $6250000, and…
A: Solution:- Basic information given in the problem as follows under:- End-of-the-World Products on…
Q: Harold Fishing Gear Company's acquired Sea Breeze Ltd for $450,000. The book values and fair values…
A: Solution: Purchase price of Sea Breeze Ltd = $450,000 Fair value of net assets of Sea Breeze = Fair…
Q: WebHelper Inc. acquired 100% of the outstanding stock of Silicon Chips Corporation (SCC) for $45…
A: Goodwill: Goodwill is an intangible asset. It is defined as the excess of cost of an acquired…
Q: A company purchased equipment for P5,000,000 on January 1, 20X8. The equipment had a useful life of…
A: The investments made by a company, whether a fixed asset investment or a debt investment or an…
Q: 1. On May 1, 2019, ABC Corporation bought a trademark from DEF Corporation for P300,000. Its…
A: Hello. Since your question has multiple parts, we will solve the first question for you. If you want…
Q: TCO C) Floyd Company purchases Haeger Company for $800,000cash on January 1, 2011. The book value of…
A: Consolidation: It can be defined as the process of merging or combining various smaller businesses…
On January 1, 20Y3, The Simmons Group, Inc., purchased the assets of NWS Insurance Co. for $40,610,000, a price reflecting an $4,061,000
Determine the book value of the goodwill on December 31, 20Y9, prior to making the impairment adjustment.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- Goodwill Impairment On January 1, 20Y3, The Simmons Group, Inc., purchased the assets of NWS Insurance Co. for $39,457,500, a price reflecting an $5,918,625 goodwill premium. On December 31, 20Y9, The Simmons Group determined that the goodwill from the NWS acquisition was impaired and had a value of only $2,219,484. a. Determine the book value of the goodwill on December 31, 20Y9, prior to making the impairment adjustment.$fill in the blank 1 b. Illustrate the effects on the accounts and financial statements of the December 31, 20Y9, adjustment for the goodwill impairment. For decreases in accounts or outflows of cash, enter your answers as negative numbers. If no account or activity is affected, select "No effect" from the dropdown and leave the corresponding number entry box blank. Balance Sheet Assets = Liabilities + Stockholders' Equity Goodwill + No effect = No effect + Retained Earnings 20Y9 Dec. 31. fill in the blank 6 fill in the blank 7 fill in the…Tamara Corporation acquired XW Products on January 1, 2020 for $6,400,000, and recorded goodwill of $1,200,000 as a result of that purchase. At December 31, 2021, the XW Products Division had a fair value of $5,450,000. The net identifiable assets of the Division (excluding goodwill) had a fair value of $4,745,000 at that time. What amount of loss on impairment of goodwill should Tamara record in 2021? 16.Hw.104. On January 3, Luna Inc. acquired all noncash assets and assumed all liabilities of Saturn Company at a cash purchase price of $960,000. Luna determined that the fair value of the assets acquired in the transaction is $1,120,000 and the fair value of liabilities is $480,000. The book value of the net assets at the purchase date was $600,000. a. Determine the amount of goodwill recorded by Luna upon purchase of Saturn Company. b. Assume that Luna is a private company that elects to amortize goodwill on a straight-line basis over 10 years. Prepare the amortization entry at December 31
- On September 1, 2020, Flint Corporation acquired Tamarisk Enterprises for a cash payment of $710,000. At the time of purchase, Tamarisk's balance sheet showed assets of $560,000, liabilities of $240,000, and owners' equity of $320,00O. The fair value of Tamarisk's assets is estimated to be $790,000. Compute the amount of goodwill acquired by Flint. Value assigned to goodwill $Baine Company purchased Vera Company at a price of $535,000. The fair value of the net assets purchased equals $434,000. Compute the amount of goodwill that Baine records at the purchase date.Radio Corporation acquired End of the World Products on January 1, 2022 for $4,000,000, and recorded goodwill of $750,000 as a result of that purchase. At December 31, 2010, the End of the World Products Division had a fair value of $4,400,000. The net identifiable assets of the Division (excluding goodwill) had a fair value of $2,700,000 at that time. What amount of loss on impairment of goodwill should Twilight record in
- Robinson Company purchased Franklin Company at a price of $3,820,000. The fair market value of the net assets purchased equals $2,750,000. 1. What is the amount of goodwill that Robinson records at the purchase date? 2. Does Robinson amortize goodwill at year-end? 3. Robinson believes that its employees provide superior customer service, and through their efforts, Robinson believes it has created $1,520,000 of goodwill. Should Robinson Company record this goodwill? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 What is the amount of goodwill that Robinson records at the purchase date? GoodwillBarbay Ltd has two divisions. It acquired one of them, Tibay Products, on January 1, 2022 for $400,000, and recorded goodwill of $50,750 as a result of that purchase. If at December 31, 2022, Tibay Products will have a recoverable amount of $370,000 and carrying value of its net assets of $355,000 (including goodwill). What amount of loss on impairment of goodwill should Barbay Ltd record in 2022, if any? $AnswerBarbay Ltd has two divisions. It acquired one of them, Tibay Products, on January 1, 2022 for $400,000, and recorded goodwill of $50,750 as a result of that purchase. If at December 31, 2022, Tibay Products will have a recoverable amount of $370,000 and carrying value of its net assets of $355,000 (including goodwill). What amount of loss on impairment of goodwill should Barbay Ltd record in 2022, if any?
- Fleming Corporation acquired Out-of-Sight Products on January 1, 2025 for $4,000,000, and recorded goodwill of $750,000 as a result of that purchase. At December 31, 2025, the Out-of- Sight Products Division had a fair value of $3,400,000. The net identifiable assets of the Division (excluding goodwill) had a fair value of $2,900,000 at that time. What amount of loss on impairment of goodwill should Fleming record in 2025? O $-0- O $250,000 O $350,000 O $600,000At year-end, QRS Company reported assets of P5,000,000 and liabilities of P2,000,000. The carrying amounts of the assets approximate fair value, except for land which has a fair value that is P300,000 greater than carrying amount. On same date, RST Company paid P6,000,000 to acquire QRS Company. Determine the amount of goodwill that should be recorded by the acquirer as a result of this purchase. a. 1,000,000 b. 3,300,000 c. 2,700,000 d. 3,000,000On September 1, 20Y8, Vernon Corporation acquired Barlow Enterprises for a cash payment of $2,300,000. At the time of acquisition, Barlow's balance sheet showed assets of $1,800,000, liabilities of $600,000, and owner's equity of $1,200,000. A recent appraisal indicated that the fair value of Barlow's assets is estimated to be $2,100,000. How much goodwill was generated due to this acquisition? What is the net dollar value impact this transaction had on assets? What is the net dollar value impact this transaction had on liabilities? What is the net dollar value impact this transaction had on equity?