During X the Pencil Corp. entered into negotiations to buy Stilo Company, finally agreeing on a final cash purchase price of $ Pencil will acquire all assets and liabilities of Stilo effective December X except for the existing cash balances of Stilo.
The December X balance sheet prepared by Stilo is shown below in column a and the revised fair values added later by Pencil are shown in column b
STILO COMPANY BALANCE SHEET
At December Xa Book Values of Stilo Cob Fair Values assigned by Pencil Corp.
Assets
Cash $ na
Accounts receivable net $
Inventory
Property, plant, and equipment net
Land
Franchise unamortized balance
Total $
Liabilities and shareholders equity
Current liabilities $
Bonds payable
Shareholders equity na
Total $
Required Marks:
Compute the amount of goodwill purchased by Pencil.
Give the entry for Pencil to record the purchase of Stilo.
