White Ltd Acquired the Net Assets of Black Ltd for $140

question 63

Multiple Choice

White Ltd acquired the net assets of Black Ltd for $140 000.At the date of purchase the fair value the net assets acquired was:
$
Plant and equipment 110 000
Inventory 37 000
Bank overdraft (20 000)
The value of purchased goodwill recorded by White Ltd is:

• A)$7000.
• B)$27 000.
• C)$13 000.
• D)$0.

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Definitions:

College Degree

A qualification awarded to students upon successful completion of a course of study in higher education, typically representing a level of achievement in a particular field.

Dual Labor Market

An economic theory which suggests that the labor market is divided into two segments: the primary (high wage, stable jobs) and the secondary (low wage, high turnover jobs).

Primary Market

The financial market for new securities issues, where companies sell new stocks and bonds to the public for the first time.

Secondary Market

A marketplace where investors buy and sell securities or assets from other investors, rather than from issuing companies.