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The trial balance for the Dark Horse Company follows: Description Cash Inventory Property, plant, and equipment - Net Current liabilities Common stock - No par Retained earnings Totals Debit Credit $ 30,000 100,000 370,000 $ 50,000 150,000 300,000 $ 500,000 $ 500,000 MPL, Inc. offers to acquire Dark Horse. The additional information is given below: Purchase price (Requirement 1 assumption) (Requirement 2 assumption) Purchase price Fair market value of the inventory The plant assets were undervalued by $ 650,000 $ 250,000 $ 180,000 ՄԴ $ 50,000 1. Calculate the amount of goodwill or bargain purchase gain to be recorded on the acquisition. (Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instructions tab you will be marked wrong.) Fair value of net assets Goodwill (bargain purchase gain) 2. Assume now that MPL, Inc. offers to acquire Dark Horse at the purchase price identified in the data table. Determine the amount of goodwill or bargain purchase gain. (Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instructions tab you will be marked wrong. Use cell references from prior calculations, if applicable.) Goodwill (bargain purchase gain)

The trial balance for the Dark Horse Company follows: Description Cash Inventory Property, plant, and equipment - Net Current liabilities Common stock - No par Retained earnings Totals Debit Credit $ 30,000 100,000 370,000 $ 50,000 150,000 300,000 $ 500,000 $ 500,000 MPL, Inc. offers to acquire Dark Horse. The additional information is given below: Purchase price (Requirement 1 assumption) (Requirement 2 assumption) Purchase price Fair market value of the inventory The plant assets were undervalued by $ 650,000 $ 250,000 $ 180,000 ՄԴ $ 50,000 1. Calculate the amount of goodwill or bargain purchase gain to be recorded on the acquisition. (Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instructions tab you will be marked wrong.) Fair value of net assets Goodwill (bargain purchase gain) 2. Assume now that MPL, Inc. offers to acquire Dark Horse at the purchase price identified in the data table. Determine the amount of goodwill or bargain purchase gain. (Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instructions tab you will be marked wrong. Use cell references from prior calculations, if applicable.) Goodwill (bargain purchase gain)

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The trial balance for the Dark Horse Company follows: Description Cash Inventory Property, plant, and equipment - Net Current liabilities Common stock - No par Retained earnings Totals Debit Credit $ 30,000 100,000 370,000 $ 50,000 150,000 300,000 $ 500,000 $ 500,000 MPL, Inc. offers to acquire Dark Horse. The additional information is given below: Purchase price (Requirement 1 assumption) (Requirement 2 assumption) Purchase price Fair market value of the inventory The plant assets were undervalued by $ 650,000 $ 250,000 $ 180,000 ՄԴ $ 50,000
Transcribed Image Text:The trial balance for the Dark Horse Company follows: Description Cash Inventory Property, plant, and equipment - Net Current liabilities Common stock - No par Retained earnings Totals Debit Credit $ 30,000 100,000 370,000 $ 50,000 150,000 300,000 $ 500,000 $ 500,000 MPL, Inc. offers to acquire Dark Horse. The additional information is given below: Purchase price (Requirement 1 assumption) (Requirement 2 assumption) Purchase price Fair market value of the inventory The plant assets were undervalued by $ 650,000 $ 250,000 $ 180,000 ՄԴ $ 50,000
1. Calculate the amount of goodwill or bargain purchase gain to be recorded on the acquisition. (Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instructions tab you will be marked wrong.) Fair value of net assets Goodwill (bargain purchase gain) 2. Assume now that MPL, Inc. offers to acquire Dark Horse at the purchase price identified in the data table. Determine the amount of goodwill or bargain purchase gain. (Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instructions tab you will be marked wrong. Use cell references from prior calculations, if applicable.) Goodwill (bargain purchase gain)
Transcribed Image Text:1. Calculate the amount of goodwill or bargain purchase gain to be recorded on the acquisition. (Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instructions tab you will be marked wrong.) Fair value of net assets Goodwill (bargain purchase gain) 2. Assume now that MPL, Inc. offers to acquire Dark Horse at the purchase price identified in the data table. Determine the amount of goodwill or bargain purchase gain. (Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instructions tab you will be marked wrong. Use cell references from prior calculations, if applicable.) Goodwill (bargain purchase gain)
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