For this year sky tech reported a net income of 75 million, Ask an Expert

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At the start of the current year, SBC Corp. purchased 30% of Sky Tech Inc. for $45 million. At the time of purchase, the carrying value of Sky Tech's net assets was $75 million. The fair market value of Sky Tech's depreciable assets was $15 million in excess of their book value. For this year, Sky Tech reported a net income of $75 million and declared and paid $15 million in dividends.

The amount of purchased goodwill is:

A. $18 million.

B. $30 million.

C. $60 million.

D. None of these is correct.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M993917

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