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Question;Pursuing;an inorganic growth strategy, Wilson Company acquired Venus Company's net;assets and assigned them to four separate reporting divisions. Wilson assigned;total goodwill of $134,000 to the four reporting divisions as given below;30. Based;on the preceding information, what amount of goodwill will be reported for;Alpha at year-end?;A. $0;B. $20,000;C. $30,000;D. $10,000;31. Based;on the preceding information, what amount of goodwill will be reported for Beta;at year-end?;A. $0;B. $14,000;C. $34,000;D. $50,000;32. Based;on the preceding information, for Gamma;A. no goodwill should be reported at year-end.;B. goodwill impairment of $30,000 should be recognized at year-end.;C. goodwill impairment of $20,000 should be recognized at year-end.;D. goodwill of $30,000 should be reported at year-end.;33. Based;on the preceding information, for Delta;A. no goodwill should be reported at year-end.;B. goodwill impairment of $15,000 should be recognized at year-end.;C. goodwill impairment of $20,000 should be recognized at year-end.;D. goodwill of $30,000 should be reported at year-end.;34. Based;on the preceding information, what would be the total amount of goodwill that;Wilson should report at year-end?;A. $0;B. $69,000;C. $79,000;D. $94,000;35. Which;of the following observations is (are) consistent with the acquisition method;of accounting for business combinations?;I. Expenses related to the business combination are expensed.;II. Stock issue costs are treated as a reduction in the issue price.;III. All merger and stock issue costs are expensed.;IV. No goodwill is ever recorded.;A. III;B. IV;C. I and II;D. I, II, and IV;36. Which;of the following observations refers to the term differential?;A. Excess of consideration exchanged over fair value of net identifiable;assets.;B. Excess of fair value over book value of net identifiable assets.;C. Excess of consideration exchanged over book value of net identifiable;assets.;D. Excess of fair value over historical cost of net identifiable assets.;37. Which;of the following observations concerning "goodwill" is NOT;correct?;A. Once written down, it may be written up for recoveries.;B. It must be tested for impairment at least annually.;C. Goodwill impairment losses are recognized in income from continuing;operations or income before extraordinary gains and losses.;D. It must be reported as a separate line item in the balance sheet.;38. Big;Company acquired the following assets and liabilities of Little Company (fair;values listed below) for $470,000 cash.;Assuming these items are all recorded at their acquisition date fair values;what additional item needs to be recorded and how will it be accounted for in;the future?;A. $30,000 Goodwill, capitalized and tested for impairment;B. $30,000 Bargain purchase, recognized in current earnings;C. $30,000 Bargain purchase, capitalized and recognized over time;D. $30,000 Goodwill, capitalized and amortized over time;39. Paul;Corp. acquired 100 percent of Sam Inc.'s voting stock on July 1, 20X1. The;following information was available as of December 31, 20X1;How much net income should be reported in Paul Corp's income statement for;20X1?;A. $370,000;B. $720,000;C. $940,000;D. $1,090,000;40. Point;Co. purchased 90% of Sharpe Corp.'s voting stock on January 1, 20X2 for;$5,580,000. Prior to the acquisition, Point held a 10% equity position in;Sharpe Company. On January 1, 20X2 Point's 10% investment in Sharpe has a book;value of $340,000 and a fair value of $620,000. On January 1, 20X2 Point;records the following;A. Debit Gain on revaluation of Sharpe's stock $280,000;B. Credit Gain on revaluation of Sharpe's stock $280,000;C. Credit Investment in Sharpe stock $5,860,000;D. Debit Investment in Sharpe stock $6,200,000

 

Paper#44332 | Written in 18-Jul-2015

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