Purchase Company recently acquired several businesses and recognized goodwill in each acquisition. Purchase has allocated the resulting goodwill to its three reporting units: RU-1, RU-2, and RU-3. Purchase opts to skip the qualitative assessment and therefore performs a quantitative goodwill impairment review annually. In its current-year assessment of goodwill, Purchase provides the following individual asset and liability carrying amounts for each of its reporting units: Carrying Amounts RU-1 Tangible assets $181,000 RU-2 $246,000 RU-3 $186,000 Trademark 197,000 Customer list 138,000 Unpatented technology 234,000 Licenses 91,500 Copyrights 73,500 Goodwill Liabilities 186,600 206,950 134,500 (44,500) The total fair values for each reporting unit (including goodwill) are $632,700 for RU-1, $743,050 for RU-2, and $748,750 for RU-3. To date, Purchase has reported no goodwill impairments. How much goodwill impairment should Purchase report this year for each of its reporting units? RU-1 Goodwill impairment loss RU-2 RU-3

Purchase Company recently acquired several businesses and recognized goodwill in each acquisition. Purchase has allocated the resulting goodwill to its three reporting units: RU-1, RU-2, and RU-3. Purchase opts to skip the qualitative assessment and therefore performs a quantitative goodwill impairment review annually. In its current-year assessment of goodwill, Purchase provides the following individual asset and liability carrying amounts for each of its reporting units: Carrying Amounts RU-1 Tangible assets $181,000 RU-2 $246,000 RU-3 $186,000 Trademark 197,000 Customer list 138,000 Unpatented technology 234,000 Licenses 91,500 Copyrights 73,500 Goodwill Liabilities 186,600 206,950 134,500 (44,500) The total fair values for each reporting unit (including goodwill) are $632,700 for RU-1, $743,050 for RU-2, and $748,750 for RU-3. To date, Purchase has reported no goodwill impairments. How much goodwill impairment should Purchase report this year for each of its reporting units? RU-1 Goodwill impairment loss RU-2 RU-3

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter12: Intangibles

Section: Chapter Questions

Problem 10RE

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Purchase Company recently acquired several businesses and recognized goodwill in each acquisition. Purchase has allocated the resulting goodwill to its three reporting units: RU-1, RU-2, and RU-3. Purchase opts to skip the qualitative assessment and therefore performs a quantitative goodwill impairment review annually. In its current-year assessment of goodwill, Purchase provides the following individual asset and liability carrying amounts for each of its reporting units: Carrying Amounts RU-1 RU-2 RU-3 Tangible assets $209,000 $299,000 $152,250 Trademark 220,000 Customer list 129,000 Unpatented technology 198,000 Licenses 122,000 Copyrights 55,250 Goodwill 193,800 220,850 125,500 Liabilities (31,250) The total fair values for each reporting unit (including goodwill) are $703,050 for RU-1, $807,250 for RU-2, and $650,300 for RU-3. To date, Purchase has reported no goodwill impairments. How much goodwill impairment should…
Purchase Company recently acquired several businesses and recognized goodwill in each acquisition. Purchase has allocated the resulting goodwill to its three reporting units: RU-1, RU-2, and RU-3. Purchase opts to skip the qualitative assessment and therefore performs a quantitative goodwill impairment review annually. In its current-year assessment of goodwill, Purchase provides the following individual asset and liability carrying amounts for each of its reporting units: Carrying Amounts RU-1 RU-2 RU-3 Tangible assets $214,000 $295,000 $207,750 Trademark 192,000 Customer list 110,250 Unpatented technology 183,000 Licenses 94,000 Copyrights 67,500 Goodwill 173,200 201,250 135,000 Liabilities (51,250) The total fair values for each reporting unit (including goodwill) are $613,000 for RU-1, $748,800 for RU-2, and $739,200 for RU-3. To date, Purchase has reported no goodwill impairments. How much goodwill impairment should…
Determine whether there is any goodwill impairment and if so please calculate the goodwill impairment loss. On the date of acquisition, the following information is available: Fair Value of the reporting unit is $720,000 Fair Value of identifiable net assets $601,000 Goodwill $119,000 One year later at the first periodic review date the following information is available: Fair value of the reporting unit is $788,000 Carrying value of the reporting unit (includes goodwill) $889,000 Fair Value of identifiable net assets $766,000 $22,000
Pelota Company recently acquired several businesses and recognized goodwill in each acquisition. Pelota allocated the resulting goodwill to its three reporting units: R-one, R-two, and R-three. Pelota opts to skip the qualitative assessment and therefore performs a quantitative goodwill impairment review annually. In its current-year assessment of goodwill, Pelota provides the following individual asset and liability carrying amounts for each of its reporting units: Items Carrying Amounts R-one R-two R-three Tangible assets $241,000 $219,000 $159,000 Trademark 199,000 - - Computer software 148,500 - - Unpatented technology - 232,000 - Licenses - 97,500 - Copyrights - - 57,250 Goodwill 150,200 202,850 118,000 Liabilities (32,250) - - The total fair values for each reporting unit (including goodwill) are $682,350 for R-one, $709,300 for R-two, and $653,650 for R-three. To date, Pelota has reported no goodwill impairments. Required: How much goodwill impairment…
Destin Company recently acquired several businesses and recognized goodwill in each acquisition. Destin has allocated the resulting goodwill to its three reporting units: Sand Dollar, Salty Dog, and Baytowne. Destin opts to skip the qualitative assessment and therefore performs a quantitative goodwill impairment review annually. In its current year assessment of goodwill, Destin provides the following individual asset and liability values for each reporting unit: Carrying Amounts Fair Values Sand Dollar Tangible assets $ 242,000 $ 260,000 Trademark 216,000 191,600 Customer list 133,500 143,800 Goodwill 181,500 ? Liabilities (52,500 ) (52,500 ) Salty Dog Tangible assets $ 239,000 $ 239,000 Unpatented technology 249,000 195,750 Licenses 102,500 112,900 Goodwill 199,400 ? Baytowne Tangible assets $ 156,000 $ 174,300 Unpatented technology 0 165,750…
Pelota Company recently acquired several businesses and recognized goodwill in each acquisition. Pelota allocated the resulting goodwill to its three reporting units: R-one, R-two, and R-three. Pelota opts to skip the qualitative assessment and therefore performs a quantitative goodwill impairment review annually. In its current-year assessment of goodwill, Pelota provides the following individual asset and liability carrying amounts for each of its reporting units: Items Tangible assets Trademark Computer software Unpatented technology Licenses Copyrights Goodwill Liabilities Carrying Amounts R-one $215,500 257,000 154,500 Goodwill impairment loss 190, 250 (35,000) R-two $261,000 R-one 232,500 100,000 187,550 The total fair values for each reporting unit (including goodwill) are $773,950 for R-one, $736,450 for R-two, and $743,500 for R-three. date, Pelota has reported no goodwill impairments. R-three $158, 250 Required: How much goodwill impairment should Pelota report this year for…
Destin Company recently acquired several businesses and recognized goodwill in each acquisition. Destin has allocated the resulting goodwill to its three reporting units: Sand Dollar, Salty Dog, and Baytowne. Destin opts to skip the qualitative assessment and therefore performs a quantitative goodwill impairment review annually.In its current year assessment of goodwill, Destin provides the following individual asset and liability values for each reporting unit:The fair values for each reporting unit (including goodwill) are $510,000 for Sand Dollar, $580,000 for Salty Dog, and $560,000 for Baytowne. To date, Destin has reported no goodwill impairments.a. How much goodwill impairment should Destin report this year?b. What changes to the valuations of Destin’s tangible assets and identified intangible assets should be reported based on the goodwill impairment tests?
please dont provide answer in image format thank you Purchase Company recently acquired several businesses and recognized goodwill in each acquisition. Purchase has allocated the resulting goodwill to its three reporting units: RU-1, RU-2, and RU-3. Purchase opts to skip the qualitative assessment and therefore performs a quantitative goodwill impairment review annually. In its current-year assessment of goodwill, Purchase provides the following individual asset and liability carrying amounts for each of its reporting units: Carrying Amounts RU-1 RU-2 RU-3 Tangible assets $218,000 $220,000 $180,750 Trademark 210,000 Customer list 124,500 Unpatented technology 233,000 Licenses 103,500 Copyrights 55,500 Goodwill 188,300 245,550 135,500 Liabilities (35,750) The total fair values for each reporting unit (including goodwill) are $675,150 for RU-1, $769,050 for RU-2, and $757,750 for RU-3. To date, Purchase has reported no…
Group Ccc-Three Ltd has identified its non-current assets consist of three classes: goodwill, land and plant.Details of items included in each class appear below.GoodwillTotal goodwill is $580,000 and no impairments have previously been recorded.$300,000 of this total relates to the purchase of Company F on 1 February 2020. The estimated fair valueof this goodwill at 30 June 2021 is $350,000.The remaining $280,000 of the total goodwill relates to the purchase of Company G on 1 January 2021.The estimated recoverable amount of this goodwill at 30 June 2021 is $250,000.LandLand was acquired on 1 June 2016 for $2,100,000. The estimated market value of the land at 30 June2021 is $2,600,000. However, if the land was sold, disposal costs of $90,000 would be incurred.PlantPlant was originally acquired for $270,000 on 1 September 2017. When purchased, the plant wasconsidered to have a nil residual value and a 10 year useful life for both accounting and tax purposes.The estimated market value of…
On January 1, 2018, Paye Company purchased Che Company at a cost that resulted in recognition of goodwill of P 2 000 000. During the first quarter of 2018 Paye Company spent an additional P 800 000 on expenditures designed to develop and maintain goodwill by training and hiring new employees. Due to these expenditures, on December 31, 2018, Paye Company Estimated the benefit period of goodwill was indefinite. On December 31, 2018, what amount should be reported as goodwill?
Larceny Company purchased another entity for P8,000,000. The assets and liabilities of the acquiree at fair value are as follows: Cash P1,000,000 Inventory 500,000 In-process research and development 5,000,000 Assembled workforce 1,200,000 Accounts payable 2,600,000 Notes Payable 400,000 REQUIRED: Determine the amount of goodwill Prepare the journal entry to record the acquisition
Topic: Intangible Assets (Goodwill) England Company assembled the following data relative to a certain entity in determining the amount to be paid for net assets and goodwill: Assets at fair value before goodwill 2,600,000 Liabilities 900,000 Shareholders' Equity 1,700,000 Net Earnings after elimination of unusual or infrequent items: 2017 200,000 2018 230,000 2019 300,000 2020 250,000 2021 270,000 Required: Calculate the amount of goodwill under the following: 1. Average earnings are capitalized at 10%. 2. A return of 8% is considered normal on net assets at fair value. Excess earnings are capitalized at 15%. 3. A return of 10% is considered normal on net assets at fair value. Goodwill is measured at 5 years excess earnings. 4. A return of 10% is considered…