Note: Problems 1 through 37 assume the use of the acquisition method.Problems 38 through 40 assume the use of the purchase method.
Amie, Inc., has 100,000 shares of $2 par value stock outstanding.Prairie Corporation acquired 30,000 of Amie’s shares on January 1, 2009, for $120,000 when Amie’s net assets had a total fair value of $350,000.On July 1, 2012, Prairie agreed to buy an additional 60,000 shares of Amie from a single stockholder for $6 per share.Although Amie’s shares were selling in the $5 range around July 1, 2012, Prairie forecasted that obtaining control of Amie would produce significant revenue synergies to justify the premium price paid.If Amie’s net identifiable assets had a fair value of $500,000 at July 1, 2012, how much goodwill should Prairie report in its postcombination consolidated balance sheet
a.$60,000.
b.$90,000.
c.$100,000.
d.$_0_.