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Calculate the amount of goodwill acquired

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Lopez Company acquired Atlantic Transportation Co. for $1,300,000. The fair market values of the assets acquired were as follows. No liabilities were assumed. 

Equipment ...........$500,000
Land ..............$150,000
Building ............$520,000
Franchise (10 year life) .......$30,000

Required: 

a. Calculate the amount of goodwill acquired. 
b. Prepare the journal entry to record the amortization of the franchise fee at the end of year 1.

Reference no: EM13926142

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