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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016
Tre Corporation’s stockholders’ equity at December 31 consisted of the following (in thousands):
Capital stock, $10 par, 60,000 shares issued and outstanding $ 600
Additional paid-in capital 150
Retained earnings 250
Total stockholders’ equity $1,000
On January 1, 2011, Bow Corporation purchased 20,000 previously unissued shares of Tre stock directly from Tre for $500,000.
REQUIRED
1. Calculate Bow Corporation’s percentage ownership in Tre.
2. Determine the goodwill from Bow’s investment in Tre. Assume the book value of all identifiable assets and liabilities equals the fair value.
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