Sellco established a car dealership in a town. This dealership is popular as no other townnearby has a showroom. The owner of this dealership wanted to sell andretire. Purchaseco came forward to buy this dealership for a price of $380,000On the date of sale the balance sheet of Sellco is as under:AssetsCashAccounts ReceivableInventoryFurnitureBuildingsAccounts ReceivableInventoryFurnitureBuildingsLoans payableIncome tax payable64,40034,200Accounts PayableLoans Payable245,100Income tax payable94,600Salaries payable244,900 Retained earnings683,200The fair market values of the assets and liabilities revealed the following:Liabilities28,900214,30072,600366,800255,30010,400Please find out thegoodwill / bargain purchase amount and also prepare the journal entryon the day of acquision106,300249,60012,1006,800308,400683,200

To be more specific, the definition of goodwill refers to the amount of the purchase price that is…

Sellco established a car dealership in a town. This dealership is popular as no other town nearby has a showroom. The owner of this dealership wanted to sell and retire. Purchaseco came forward to buy this dealership for a price of $380,000 On the date of sale the balance sheet of Sellco is as under: Assets Cash Accounts Receivable Inventory Furniture Buildings 64,400 34,200 245,100 683,200 Liabilities 94,600 Salaries payable 244,900 Retained earnings Accounts Payable Loans Payable Income tax payable 28,900 214,300 72,600 366,800 255,300 10,400 The fair market values of the assets and liabilities revealed the following: Accounts Receivable Inventory Furniture Buildings Loans payable Income tax payable Please find out thegoodwill / bargain purchase amount and also prepare the journal entry on the day of acquision 106,300 249,600 12,100 6,800 308,400 683,200

Sellco established a car dealership in a town. This dealership is popular as no other town nearby has a showroom. The owner of this dealership wanted to sell and retire. Purchaseco came forward to buy this dealership for a price of $380,000 On the date of sale the balance sheet of Sellco is as under: Assets Cash Accounts Receivable Inventory Furniture Buildings 64,400 34,200 245,100 683,200 Liabilities 94,600 Salaries payable 244,900 Retained earnings Accounts Payable Loans Payable Income tax payable 28,900 214,300 72,600 366,800 255,300 10,400 The fair market values of the assets and liabilities revealed the following: Accounts Receivable Inventory Furniture Buildings Loans payable Income tax payable Please find out thegoodwill / bargain purchase amount and also prepare the journal entry on the day of acquision 106,300 249,600 12,100 6,800 308,400 683,200

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter12: Fainancial Statement Analysis

Section: Chapter Questions

Problem 93PSA: Accounting Alternatives and Financial Analysis Lemon Automobiles has asked your bank for a $100,000...

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