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King Ltd Acquired the Business of Prince Ltd for a Cash

Question 42

Multiple Choice

King Ltd acquired the business of Prince Ltd for a cash payment of $480 000. The carrying amount of Prince Ltd's assets at the time of purchase was $490 000 while the independent fair value was $460 000. There were no liabilities. What is the value of the purchased goodwill recorded by King Ltd?


A) $(10 000)
B) $0
C) $20 000
D) 30 000

Correct Answer:

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