On January 1, 2011, John Doe Enterprises (JDE) acquired a 55% interest in bubba Manufacturing Inc. (BMI). JDE paid for the transaction with $3 million cash and 500,000 shares of JDE common stock (par value $1.00 per share). At the time of the acquisition, BMI's book value was $16,970,000. On January 1 JDE stock had a market value of $14.90 per share and there was no control premium in this transaction. Any consideration transferred over book value is assigned to goodwill. BMI had the following balances on January 1, 2011
Land. Book value 1700000 FMV: ................2550000
Buildings 7 remaining life Book value: 2700000 FMV ........3400000
Equipment 5 year remaining life Book value 3700000 FMV .....3300000
For internal reporting purposes, JDE employed the equity method to account for this investment.
Prepare a schedule to determine goodwill, and the amortization and allocation amounts.