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Peter acquires 100% of Saul for 5,254,360 in a tax-free business combination. The applicable income...

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Accounting

Peter acquires 100% of Saul for 5,254,360 in a tax-free business combination. The applicable income tax rate is 30%. Goodwill is not deductible for tax purposes. Based on the following information about the assets and liabilities of Sunfish, what amount should Porpoise record as goodwill for this acquisition on the date of acquisition?

Old book basis Old tax basis Fair value
Cash $400,000 $400,000 $400,000
Equipment, net of depreciation 500,000 200,000 750,000
Patents 0 0 2,000,000
Goodwill 80,000 NA ?
Accounts payable (300,000) (300,000) (300,000)
Deferred income taxes payable (90,000) NA ?
Notes payable (200,000) (200,000) (230,000)

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