On January 1, 2017, Simpson Company Purchased All of the Assets

question 59

Essay

On January 1, 2017, Simpson Company purchased all of the assets and assumed all of the liabilities of Dobson Company for $400,000. Dobson's balance sheet showed total assets of $450,000 and total liabilities of $210,000 of this date. An appraiser determined all assets except for land are valued at fair market value. The land is worth $20,000 more than its book value.
A. Calculate goodwill in connection with this business combination.
B. Prepare the journal entry to record the combination.

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