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IOU Inc. purchased all of the outstanding common shares of UNI Inc. for cash of...

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Accounting

IOU Inc. purchased all of the outstanding common shares of UNI Inc. for cash of $800,000. On the date of acquisition, UNI's assets included $2,000,000 of inventory, and land with a book value of $120,000. UNI also had $1,400,000 in liabilities on that date. UNI's book values were equal to their fair market values, with the exception of the company's land, which was estimated to have a fair market value which was $50,000 higher than its book value. How much goodwill would be created by IOU's acquisition of UNI?

Multiple Choice

$80,000

Nil

$30,000

$50,000

Answer & Explanation Solved by verified expert
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