On January 1, 2011, Harrison Corporation Spent $2,600,000 to Acquire

question 31

Multiple Choice

On January 1, 2011, Harrison Corporation spent $2,600,000 to acquire control over Involved, Inc. This price was based on paying $750,000 for 30 percent of Involved's preferred stock, and $1,850,000 for 80 percent of its outstanding common stock. As of the date of the acquisition, Involved's stockholders' equity accounts were as follows:

Assuming Involved's accounts are correctly valued within the company's financial statements, what amount of goodwill should be recognized for the Investment in Involved?

• A) $(100,000.)
• B) $0.
• C) $200,000.
• D) $812,500.
• E) $2,112,500.

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