On January 1, 20X1, Porta Corporation purchased Swick Company’s net assets and assigned goodwill of $80,900...

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Accounting

On January 1, 20X1, Porta Corporation purchased Swick Company’snet assets and assigned goodwill of $80,900 to Reporting DivisionK. The following assets and liabilities are assigned to ReportingDivision K on the acquisition date: Carrying Amount Fair Value Cash$ 14,900 $ 14,900 Inventory 56,900 71,900 Equipment 179,000 199,000Goodwill 80,900 Accounts Payable 30,900 30,900 Required: OnDecember 31, 20X3, Porta must test goodwill for impairment.Determine the amount of goodwill to be reported for Division K andthe amount of goodwill impairment to be recognized, if any, ifDivision K’s fair value is determined to be $349,000. $289,000.$269,000.
Amount of Goodwill Goodwill Impairment
a. $80,900 $0
b.
c.

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3.9 Ratings (357 Votes)

Division K Carrying Value Fair Value Cash 14900 14900 Inventory 56900 71900 Equipment 179000 199000 Goodwill 80900 80900 Accounts Payable 30900 30900 Total 362600 397600 1 349000 As the amount of fair value of Division K is See Answer

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