Business combination transaction

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Reference no: EM13912872

First all Corp. acquired four division of a competitor eight years ago in a business combination transaction, paying $25 more than the fair value of the identifiable assets required. The good will was determined to be 100% attributable to the operations if the east division. Although these two divisions are cash generating units in their own right, there was no basis on which to allocate the goodwill between them. FC has identified the combined divisions as one CGU for assessing goodwill impairment on an annual basis. At the end of the most recent year, the following information us available:

Carrying Amount

East Division $75

Sotuh Divison $125

Goodwill $25

(A) Identify the asset, cash generating unit, or group of CGUs that FC should use to test for impairment

(B) Is there an imapirment loss at the end of the current year? Explain how you determined your answer.

Reference no: EM13912872

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