P Company acquired 90 percent of the voting stock of S Company on January 1,...
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P Company acquired 90 percent of the voting stock of S Company on January 1, 20X2, for $820,000. The fair value of the noncontrolling interest on 1/1/20X2 was $83,000. This was based on stock trades immediately before and after 1/1/20X2.
On 1/1/20X2, S Company had a total shareholder equity of $650,000.
S Company owned a patent on 1/1/20X2 that was not on its balance sheet. The patent was worth $50,000 and had a 10-year remaining life.
A. How much goodwill is recognized as a result of this acquisition?
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