On December 31,20X8,Polaris Corporation Acquired 100 Percent Ownership of Star

question 33

Multiple Choice

On December 31,20X8,Polaris Corporation acquired 100 percent ownership of Star Corporation.On that date,Star reported assets and liabilities with book values of $300,000 and $100,000,respectively,common stock outstanding of $50,000,and retained earnings of $150,000.The book values and fair values of Star's assets and liabilities were identical except for land which had increased in value by $10,000 and inventories which had decreased by $5,000.
-Based on the preceding information,what amount of goodwill will be reported if the acquisition price was $240,000?

• A)$0
• B)$40,000
• C)$15,000
• D)$35,000

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Definitions:

Capacitive Reactance

The measure of the opposition that a capacitor presents to alternating current, due to the electric field created in the capacitor.

Ammeter

An instrument for measuring the flow of electric current in amperes.

Supply

The provision of electrical power to a system, device, or network.

Pure Capacitive Circuit

An electrical circuit that contains only capacitors, with no resistance or inductance to affect the flow of current.