On January 1, 20X7, Falcon Acquired 100% of the Outstanding

question 6

Essay

On January 1, 20X7, Falcon acquired 100% of the outstanding shares of Intra for $3,600,000. Both are mining companies involved in nickel and copper production. The balance sheet for Intra at the date of acquisition is shown below, together with estimates of the fair values and tax values of Intra's recorded assets and liabilities.
Intra Corp
Statement of Financial Position
December 31, 20X 6 The tax rate for Intra and for Falcon is 30%.
Required:
What is the amount of goodwill to be recorded for this business combination?

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Definitions:

Exact Simple Interest

Interest calculated on the principal amount of a loan or investment, based on a 365-day year without compounding.

Loan Period

The duration of time from when a loan is issued to when it is expected to be fully repaid, including its principal and interest.

365-day Year

A financial calculation basis using a calendar year of 365 days for computing interest rates and other financial metrics, ignoring leap year variations.

Exact Simple Interest

The precise amount of interest earned or paid on a principal amount over a specific period, without compounding.