On January 2, 2014, Payne Co. purchased Glick Co. at a cost that resulted in rec

Question

On January 2, 2014, Payne Co. purchased Glick Co. at a cost that resulted in recognition of goodwill of $200,000 having an expected benefit period of 10 years. Glick is treated as a reporting unit and the entire amount of the recognized goodwill is assigned to it. During the first quarter of 2014, Glick spent an additional $80,000 on expenditures designed to maintain goodwill. Due to these expenditures, at December 31, 2014, Glick estimated that the benefit period of the goodwill was 40 years. In its consolidated December 31, 2014 balance sheet, what amount should Payne report as goodwill?

Answer

$180,000

$200,000

$252,000

$280,000

$180,000

$200,000

$252,000

$280,000

Explanation / Answer

$280,000

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