Company A purchases Company B. This is a 100% equity purchase which means that Company A acquires all of the Company B assets and assumes the liabilities of Company B.
Calculate the value of goodwill recognized in the acquisition. Round to the nearest whole dollar and do not include the dollar sign ($).
Assume
Awnser :- Company A paid cash for Company B :- 1050000
we calculate the value of goodwill :- Normal capital - Actual capital employed
Here normal capital which is paid value that is :- 1050000
actual capital employed calculated with using formal :- total assets - outside laibilites
total assets :- 1310000 + 80000 = 1390000
outside liabilites :- 300000 + 600000 - 680000 = 380000
using capital employed formula that is ( 1390000 - 380000 = 1010000 )
goodwill = 1050000 - 1010000 = 40000
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