Solution-Problem regarding the contingent consideration

Problem regarding the contingent consideration

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Problem: Contingent Consideration

Jones Company acquired Jackson Company for $2,200,000 cash. At that time, the fair value of recorded assets and liabilities was $1,500,000 and $280,000 respectively. If Jackson meets specified sales targets, Jones is required to pay an additional $360,000 in cash per the acquisition agreement. Jones estimates the probability of this to be 50%, resulting in a potential additional payment to Jackson of $180,000. The direct costs related to the acquisition were $150,000. What was the amount of the goodwill related to the acquisition?

Reference no: EM13849549

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Problem regarding the contingent consideration

Reference no: EM13849549

Reference no: EM13849549

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