Questions -
Q1. On September 29, year 2, Wall Co. paid $860,000 for all the issued and outstanding common stock of Hart Corp. On that date, the carrying amounts of Hart's recorded assets and liabilities were $800,000 and $180,000, respectively. Hart's recorded assets and liabilities had fair values of $840,000 and $140,000, respectively. In Wall's September 30, year 2 balance sheet, what amount should be reported as goodwill?
$180,000
$20,000
$240,000
$160,000
Q2. The following information was abstracted from the accounts of the Oar Corporation at December 31, year 2:
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Total income since incorporation
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$840,000
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Total cash dividends paid
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$260,000
|
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Proceeds from sale of donated stock (FV on date of donation was $30,000)
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$90,000
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Total value of stock dividends distributed
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$60,000
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Excess of proceeds over cost of treasury stock sold
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$140,000
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The donated stock was classified as a trading security. What should be the current balance of retained earnings?
$610,000
$520,000
$670,000
$580,000