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Fresh Cut Corporation purchased all the outstanding common stock of Premium Meats for $11,900,000 in...

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Accounting

Fresh Cut Corporation purchased all the outstanding common stock of Premium Meats for $11,900,000 in cash. The book values and fair values of Premium Meats' assets and liabilities were as follows:
Book Value Fair Value
Accounts Receivable $ 1,750,000 $ 1,550,000
Equipment 8,450,0009,850,000
Patents 290,0001,650,000
Notes Payable (2,600,000)(2,600,000)
Net assets $ 7,890,000 $ 10,450,000
Required:
1. Calculate the amount Fresh Cut should report for goodwill.
2. Record Fresh Cut's acquisition of Premium Meats. Record the acquisition of Premium Meats.

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