Perch Co Acquired 80% of the Common Stock of Float Corp

question 96

Multiple Choice

Perch Co. acquired 80% of the common stock of Float Corp. for $1,600,000. The fair value of Float's net assets was $1,850,000, and the book value was $1,500,000. The non-controlling interest shares of Float Corp. are not actively traded.
What is the total amount of goodwill recognized at the date of acquisition?

• A) $150,000.
• B) $250,000.
• C) $0.
• D) $120,000.
• E) $170,000.

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Definitions:

Torture

The use of brutal, degrading, and disorienting strategies to reduce victims to a state of utter helplessness.

Deprivation

The lack or denial of something considered to be a necessity, leading to various psychological or physical effects.

Blunt Object

A non-sharp instrument or item used to hit or press against something with force, often associated with causing injury.

Acute Stress Disorder

An anxiety disorder characterized by the development of severe anxiety, dissociation, and other symptoms that occur within a month after exposure to a traumatic event.