Reference no: EM132625290

On 1 July 2015, Fluffy Ltd acquired all the issued shares of Glider Ltd. Fluffy Ltd paid $30 000 in cash and 20 000 shares in Fluffy Ltd valued at $3 per share. At this date, the equity of Glider Ltd consisted of $66 000 share capital and $6000 retained earnings.

At 1 July 2015, all the identifiable assets and liabilities of Glider Ltd were recorded at amounts equal to their fair values except for:

Plant (cost $150 000)         Carrying amount      $120 000                                  Fair value $123 000

Patents                           Carrying amount       $105 000                                   Fair value $90 000

Inventory                        Carrying amount       $18 000                                      Fair value $22 500

The plant was considered to have a further 5-year life. The patents were sold for $120 000 to an external entity on 18 August 2015. The inventory was all sold by 30 June 2016

Problem 1: Calculate goodwill according to AASB