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Find and prepare the journal entry for the acquisition

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Reference no: EM132735884

Purple Corp. purchased all of the listed assets and liabilities of Sudden Corp. for $1,600,000. The following assets and liabilities were purchased:

                                                          Book Value Fair              Market Value

Accounts receivables                                   $140,000                     $140,000

Inventory                                                     168,000                    256,000

Property, plant, and equipment (net)                   820,000                   1,040,000

Patent                                                                0                             276,000
 
Liabilities                                                         (170,000)                          (170,000)

Required:

Problem 1. What is the appropriate amount that would be recorded for goodwill?

Problem 2. Prepare the journal entry for the acquisition. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Reference no: EM132735884

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