Question: Accounting for intangibles Midland Telecom provides communication services in Iowa, Nebraska, the Dakotas, and Montana. Midland purchased goodwill as part of the acquisition of Surley Wireless Enterprises, which had the following figures:
Requirements: 1. Journalize the entry to record Midland's purchase of Surley Wireless for $320,000 cash plus a $480,000 note payable.
2. What special asset does Midland's acquisition of Surley Wireless identify? How should Midland Telecom account for this asset after acquiring Surley Wireless? Explain in detail.