Please get the correct answers Question 9 (7 points) Crow Company buys 90 percen

Question

Please get the correct answers

Question 9 (7 points) Crow Company buys 90 percent of the outstanding common stock of Bird Company for $900,000. Crow did not have to pay a control premium to get these shares so that the price paid is viewed as a reasonable representation of the value of the new subsidiary. Bird has identifiable assets and liabilities with a net book value of $710,000 but a fair value of S820,000. On a consolidated balance sheet on that date, what should be reported as goodwill? Question 9 options: A) S80,000 B) S162,000 C) S180,000 D) S290,000

Explanation / Answer

Answer:-

(C) $1,80,000

$9,00,000/90%= $10,00,000

Then Take a fair value of $8,20,000 which is less then total stock

So, $10,00,000-$8,20,000 will be treted as goodwill

so, $1,80,000 is treated as goodwill.

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