Question

Anchor Company purchased a manufacturing machine with a list price of $96,000 and received a 2% cash discount on the purchase. The machine was delivered under terms FOB shipping point, and transportation costs amounted to $4,400. Anchor paid $6,300 to have the machine installed and tested. Insurance costs to protect the asset from fire and theft amounted to $8,200 for the first year of operations. What is the cost of the machine?

Multiple Choice

• $98,480

• $112,980

• $104,780

• $94,080

The balance sheet of Flo's Restaurant showed total assets of $520,000, liabilities of $168,000 and stockholders’ equity of $402,000. An appraiser estimated the fair value of the restaurant assets at $615,000. If Alice Company pays $825,000 cash for the restaurant, what is the amount of goodwill?

Multiple Choice

• $210,000

• $305,000

• $423,000

• $378,000

Answer 1