Server Solutions Paid $211,000 to Acquire Tabletz,Inc

question 44

Multiple Choice

Server Solutions paid $211,000 to acquire Tabletz,Inc. ,an electronic gadget-advertising website.At the time of the acquisition,Tabletz's balance sheet reported total assets of $211,000 and liabilities of $105,500.The fair market value of Tabletz's assets was $211,000.The fair market value of its liabilities was $105,500.How much goodwill did Server Solutions purchase as part of the acquisition of Tabletz?

• A)$211,000
• B)$52,750
• C)$105,500
• D)$158,250

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Definitions:

Direct Labor

The wages and related benefits for employees directly involved in the production of goods or services, considered a variable cost as it typically changes with production levels.

Indirect Labor

Labor costs associated with employees that cannot be directly traced to the production of goods or services, such as maintenance and supervision.

Manufacturing Overhead

All indirect costs associated with the production process, including utilities, maintenance, and factory supplies, that cannot be directly traced back to a product.

Raw Materials

Unprocessed or minimally processed materials that are used as inputs in manufacturing and production processes.