b) Cultus Corp. decided to expand further by purchasing the net assets of Silk Corp....
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b) Cultus Corp. decided to expand further by purchasing the net assets of Silk Corp. Silk's statement of financial position at December 31, 2020 follows. Answer: SILK CORP. Statement of Financial Position December 31, 2020 Assetsliabilities and Equities Cash$ 210,000Accounts payables 325,000 Receivables450,000Common shares 800,000 Inventory275,000Retained earnings_835.000 Plant assets (net) 1.025.000 Total assets$ 1.960.000Total equities$ 1.960.000 An appraisal, agreed to by both parties, indicated that the fair value of the inventory was $ 320.000 and the fair value of the plant assets was $ 1.225.000. The fair value of the receivables and payables is equal to the amount reported on the balance sheet. The agreed purchase price was $ 3 million, and this amount was paid in cash to the owners of Silk Corporation. Instructions: Calculate the amount of goodwill (if any) implied in the purchase price of $ 3 million. Show calculations
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