Question

On january 1, 2017, robinson company purchased franklin company at a price of $3,850,000. the fair market value of the net assets purchased equals $2,870,000. 1. what is the amount of goodwill that robinson records at the purchase date?

Answer 1

Goodwill is $980,000.
robinson company purchased franklin company at a price of $3,850,000. the fair market value of the net assets purchased equals $2,870,000.

Consideration given = 3850000
Fair Value of the Assets=2870000
Good will = 980000