need help problem with googwill - ACCA Global Accountancy Discussion Forums

onehundred · 12-07-2009, 03:40 AM

ABC is a limited company, the net asset of Mary & Co were purchased on 3 March 20x7. Assets were valued as follow:
Investments $ 231k
Inventory: $ 34k

the consideration for the acquisition of Mary & Co is $ 285k on 31 December 20x7.
So the Goodwill is calculated as: 285k - 265k = 20k
Goodwill will appear on the Current Assets side
I have a question is, what will appear in the other side of Balance Sheet (20k)?

taing · 12-08-2009, 11:28 PM

On your acquisition.

onehundred · 12-14-2009, 06:52 AM

I don't really understand, what is acquisition account? an account likes Trading account?if it is, it will appear on asset's side not liabilities and equity's side