What is goodwill to be reported in consolidated statement

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Problem

On January 1, 2021, B Corp. acquired an 80% interest in Entity C, Inc. for 78,000, which includes a control premium of 3,000. Information on the acquisition date (Jan. 1, 2021): Entity C's net assets have a carrying amount of 74,000, including goodwill of 1,000. Upon analysis, Entity C's inventory was undervalued by 4,000 and equipment was overvalued by 12,000, respectively. The remaining useful life of the equipment is 6 years. B Corp. accounts for its investment in subsidiary using the cost method. Information subsequent to the acquisition date (Dec. 31, 2021): B Corp. and Entity C showed retained earnings of 114,800 and 20,000, respectively, on December 31, 2021. B Corp. and Entity C reported net income of 64,800 and 20,000, respectively, during 2021. B Corp. and Entity C declared and paid dividends of 10,000 and 6,000, respectively, in 2021. It is determined that the value of the Goodwill from acquisition is 27,750, on December 31, 2021. Get the instant assignment help. What is the Goodwill to be reported in the consolidated statement of financial position as of January 1, 2021?

Reference no: EM133972259

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