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What should be the amount recorded as goodwill

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Reference no: EM132925258

Question - On April 1, 2025, the Rado Company paid P600,000 for the net assets of Citizen Company in a transaction properly accounted for as an acquisition. On this date, the assets and liabilities of Citizen Company were

Cash 60,000

Merchandise inventory 180,000

Plant assets (net) 360,000

Liabilities 135,000

Furthermore, it was determined that the merchandise inventory of Citizen Company had a fair market value of P142,500 and the plant assets of P420,000. What should be the amount recorded as goodwill by Rado Company as a result of the business combination?

a. None of the given

b. P112,500

c. P0

d. P37,500

Reference no: EM132925258

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