DOL Co. had the following account balances as of December 1, 2015: Inventory $720,000 Land 600,000 Building—net (valued at $1,200,000) 1,080,000 Common stock ($10 par value) 960,000 Retained earnings, December 1, 2010 1,320,000 Revenues 720,000 Expenses 600,000 Miller Inc. transferred $1.7 million in cash and 12,000 shares of its newly issued $30 par value common stock (valued at $90 per share) to acquire all of DOL’s outstanding common stock. Assume that Miller paid cash of $2.8 million. No stock is issued. An additional $50,000 is paid in direct combination costs. For Goodwill, determine what balance would be included in a December 1, 2015 consolidation? Solution Total fair value of assets acquired =total assets + revaluation increase 2,400,000 + 120,000 = 2,520,000 Total consideration paid = 1,700,000 + 12000 shares X 90 per share 1,700,000 + 1,080,000 = $ 2,780,000 Goodwill = 2,780,000 - 2,520,000 = $ 260,000 If all cash given and extra cash for covering cost than consideration = 2,800,000 + 50,000 = $ 2,850,000 Total fair value of assets = $ 2,520,000 Goodwill = $ 3,30,000..