Question 3 Not yet answered Marked out of 2 p Flag question Summer acquired 70% of the ordinary shares of Winter for €100,000 on 31 December 20x3 when the net assets of Winter were €110,000 The goodwill arising on the acquisition of Winter is: Select one: O a

Accounting Nov 16, 2020

Question 3 Not yet answered Marked out of 2 p Flag question Summer acquired 70% of the ordinary shares of Winter for €100,000 on 31 December 20x3 when the net assets of Winter were €110,000 The goodwill arising on the acquisition of Winter is: Select one: O a. €10,000 positive O b.623,000 positive OC. €40.000 positive d. €10,000 negative

Expert Solution

The answer is €23,000 positive

Goodwill = Actual Amount Paid - Value of net asset for % purchased

= €100,000 - 70% of €110,000

= €100,000 - €77,000

= €23,000

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