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  3. a company pays $3.8 million in cash to acquire 85%

A company pays $3.8 million in cash to acquire 85% of the stock of another...

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Accounting

A company pays $3.8 million in cash to acquire 85% of the stock of another company. The fair value of the noncontrolling interest at the date of acquisition is $1.1 million, and the book value of the acquired company is $2.2 million. There are no revaluations of the acquired companys identifiable net assets.

Required:

a) How much of the goodwill or bargain is allocated to the controlling interest?

b) How much of the goodwill or bargain is allocated to the non-controlling interest?

Show your work please.

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