Problemon january 1 2012 gray purchases 100 of morgan, Ask an Expert

Finance

Problem:

On January 1, 2012, Gray purchases 100% of Morgan Biometrics Inc. for $11.4 million. At the time of acquisition, the fair market value of Morgan Biometrics' tangible net assets (excluding goodwill) is $10.2 million. Gray ascribes the excess of $1,200,000 to goodwill. During the year the fair value of Morgan Biometrics declines to $10.8 million and the fair value of Morgan Biometrics' tangible net assets is estimated at $9.8 million as of December 31, 2012.

1. Determine if the goodwill has become impaired and, if so, the amount of the impairment.

2. What impact does the impairment of goodwill have on Gray Corp's financial statements?

Summary of problem:

These short answer questions is from Finance. The 1st question is about computation of impaired goodwill and the 2nd question is about the impact of goodwill impairment on financial statements.

View complete question

Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M91397517
Price:- $20

Guranteed 24 Hours Delivery, In Price:- $20

Have any Question?Write your Review or question?

Related Questions in Basic Finance

Assume the probability of a male being lt 21 is 1867 the

Assume the probability of a male being 50 is 4.80%, and the probability of being female and > 50 is 8.00%. Based on this information and the information in the tables above, what is the probability that someone

Ultra petroleum has earnings per share of 156 and a pe

Ultra Petroleum has earnings per share of $1.56 and a P/E ratio of $32.48. What is the stock price?

Corporate fund started the year with a net asset value of

Corporate Fund started the year with a net asset value of $15.90. By year-end, its NAV equaled $13.80. The fund paid year-end distributions of income and capital gains of $3.30. What was the rate of return to an investor ...

Confused on this one would appreciate any helpthe following

Confused on this one. Would appreciate any help. The following information relates to Lobo Corporation: Cash $20,000 Accounts receivable $50,000 Marketable securities ...

Corporate finance questionan investment pays you 30000 at

Corporate Finance Question: An investment pays you $30,000 at the end of this year, and $10,000 at the end of each of the four following years. What is the present value (PV) of this investment, given that the interest r ...

Sam is a manager of a savings and loan and he is expecting

Sam is a manager of a savings and loan and he is expecting interest rates to increase in the near future. What type of mortgage would Sam most likely recommend the S&L to hold? shared-appreciation mortgage, 15 year term. ...

We have the following investments in our

We have the following investments in our portfolio: Investment Amount Expected Return Beta A Stock $2,000 ...

You are looking at price-to-book ratios as an alternative

You are looking at price-to-book ratios as an alternative to price-to-earnings ratios. Three of the advantages of P/B ratios that your assistant gives are: Advantage 1: Because book value is a cumulative balance sheet ac ...

Bacchus vineyards inc is expected to pay its first annual

Bacchus Vineyards, Inc. is expected to pay its first annual dividend five years from now. That payment will be $4.39 a share. Starting in year six, the company will increase the dividend by 3.7 percent per year. The requ ...

1 your firm expects to incur a 500k loss in year 1 and

1. Your firm expects to incur a ($500K) loss in year 1 and make $100K of net income in year 2 and $300K of net income in year 3. The retention ratio is projected to be 100%. The beginning equity balance on the balance sh ...

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Basic Finance Expert