Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. nike inc. acquired under armor corp. on august 1,

Nike Inc. acquired Under Armor Corp. on August 1, 2020. The total purchase price of...

90.2K

Verified Solution

Question

Accounting

Nike Inc. acquired Under Armor Corp. on August 1, 2020. The total purchase price of the acquisition was $3,500,000. Under Armor will become a division of Nike post-acquisition.Under Armor's balance sheet at the date of acquisition was as follows:


image

At the date of acquisition, the book value of the assets approximated fair value except for the patent. The fair value of the patent is $750,000 at the acquisition date.
Compute the amount of goodwill recognized by Nike as a result of the acquisition.


Prepare the August 1st journal entry for Nike to record the purchase of Under Armor.

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students