CLICK HERE TO REVIEW LEARNING OBJECTIVES QUESTION 3 Answer saved Points out of 1

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CLICK HERE TO REVIEW LEARNING OBJECTIVES QUESTION 3 Answer saved Points out of 1.00 Rag question Assigning goodwill to controlling and noncontrolling interests Assume that on July 1, 2013, a parent company paid $1,885,000 to purchase a 7596 interest in a subsidiary's voting common stock. On that date, the fair value of the 25% interest not purchased by the parent company is $625,000. The acquisition-date fair value of the identifiable net assets of the subsidiary is $2.400,000. What is the amount of goodwill assigned to the controlling and noncontrolling interests respectively. on the acquisition date? $80.000 and $25,000 $83,500 and $26,500 $85,000 and $25,000 $84,000 and $26,000

Explanation / Answer

share of non controlling interest in fair value of net asset = 2400000*.25= 600000

share of controlling interest = 2400000*.75 = 1800000

Goodwill on acquisition(controlling) = 1885000-1800000= 85000

Goodwill (non controlling)= 625000-600000=25000

correct option is "C"

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