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On January 1, 2013, Robinson Company purchased Franklin Company at a price of $ 2,500,000. The fair market value of the net assets purchased equals $ 1,800,000.
1. What is the amount of goodwill that Robinson records at the purchase date?
2. Explain how Robinson would determine the amount of goodwill amortization for the year ended December 31, 2013.
3. Robinson Company believes that its employees provide superior customer service, and through their efforts, Robinson Company believes it has created $ 900,000 of goodwill. How would Robinson Company record this goodwill?
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