### Computation of impaired goodwill

Assignment Help Finance Basics
##### Reference no: EM13827648

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.

#### The income statement measures the income and expenses

The Income Statement measures the income and expenses of a company over a specific period of time. Reflecting on your personal financial statement for the past month, can y

#### Find the total cost of producing 101 items

The cost function of a certain commodity is C(x) = 78 + .16x − .0006x 2 + .000003x 3. (a) Find C ′ (100). (What does this mean?)  (b) Find the total cost of producing 101 item

#### Does country(uk) have stock exchanges

Does this country(uk) have stock exchanges? If yes, how many companies are listed and what is the total market capitalization? Do you consider the market as "most liquid",

Forum Topic Responses: One comprehensive forum topic is assigned weekly. Students are required to research their selected forum topic, Select one of the following forum topic

#### What is the balance or amount outstanding on the loan

A borrower is offered a mortgage loan for \$100,000 with an interest rate of 10% and a 30-year amortization period with monthly payments. The lender charges three points at ori

#### Question regarding the money management

Most money managers have a portion of their compensation tied to the performance of the portfolios they manage. Explain how this arrangement can create an ethical dilemma fo

#### Calculate the average accounts payable

A chain of appliance stores, APP Corporation, purchases inventory with a net price of \$500,000 each day. The company purchases the inventory under the credit terms of 2/15, ne

#### What is the yield to maturity

1 Sentry Cop. Bonds have a coupon payment of 7.25%. The bonds have a par value of \$1000, a current price of \$1125, and they will mature in 13 years. a)What is the yield to mat