On January 1, 2021 Major acquired 60% of Minor for a cash payment of $600,000. At date of acquisition, the fair value of Minor's net assets were $300,000. Assuming there is no control premium, how much Goodwill is recorded in the consolidated financial statements $420,000 $300,000 $700,000 $60,000

On January 1, 2021 Major acquired 60% of Minor for a cash payment of $600,000. At date of acquisition, the fair value of Minor's net assets were $300,000. Assuming there is no control premium, how much Goodwill is recorded in the consolidated financial statements $420,000 $300,000 $700,000 $60,000

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

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Concept explainers

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.

Question

On January 1, 2021 Major acquired 60% of Minor for a cash payment of $600,000. At date of acquisition, the fair value of Minor's net assets were $300,000. Assuming there is no control
premium, how much Goodwill is recorded in the consolidated financial statements
$420,000
$300,000
$700,000
$60,000

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