On April 1, 2006, Dart Co. paid $620,000 for all the issued and outstanding common stock of Wall Corp. The recorded assets and liabilities of Wall Corp. on April 1, 2006, follow:
|
Cash |
$ 60,000 |
|
Inventory |
180,000 |
|
Property and equipment (net of accumulated depreciation of $220,000) |
320,000 |
|
Goodwill |
100,000 |
|
Liabilities |
(120,000) |
|
Net assets |
$ 540,000 |
On April 1, 2006, Wall’s inventory had a fair value of $150,000, and the property and equipment (net) had a fair value of $380,000. What is the amount of goodwill resulting from the business combination?
- $150,000
- $120,000
- $ 50,000
- $ 20,000