Pied Piper Pies Has Been in Business 8 Years with 4

question 22

Essay

Pied Piper Pies has been in business 8 years with 4 stores in the San Francisco bay area. Their local reputation for making savoury pies such as curried potatoes is well recognized. A national food distributor has offered to purchase the company. Pied Piper has $1.2 million of assets on their books but those assets have $1.5 million in value at fair market value and $.3 million of liabilities. If the distributor offers to buy Pied Piper for $3.5 million and assume the liabilities of Pied Piper, how much will goodwill be based on the offered purchase price?

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Definitions:

Grass Production

The cultivation and management of grasses for various uses, including fodder, lawn, and agricultural purposes.

Wooded Area

A region covered with trees and shrubs, often serving as a habitat for various forms of wildlife and a vital part of an ecosystem.

Carnivore

An animal or organism that primarily consumes the flesh of other animals for nutrition.

Herbivore

An animal that primarily eats plants or plant-based materials.