Reference no: EM132019895

Questions -

Q1. On September 29, year 2, Wall Co. paid $860,000 for all the issued and outstanding common stock of Hart Corp. On that date, the carrying amounts of Hart's recorded assets and liabilities were $800,000 and $180,000, respectively. Hart's recorded assets and liabilities had fair values of $840,000 and $140,000, respectively. In Wall's September 30, year 2 balance sheet, what amount should be reported as goodwill?

$180,000

$20,000

$240,000

$160,000

Q2. The following information was abstracted from the accounts of the Oar Corporation at December 31, year 2:

Total income since incorporation	$840,000
Total cash dividends paid	$260,000
Proceeds from sale of donated stock (FV on date of donation was $30,000)	$90,000
Total value of stock dividends distributed	$60,000
Excess of proceeds over cost of treasury stock sold	$140,000

The donated stock was classified as a trading security. What should be the current balance of retained earnings?

$610,000

$520,000

$670,000

$580,000