Respuesta :
Answer: Option (C) is correct.
Explanation:
Given that,
On January 1, 2012
Paar's equipment (10-year life) has a book value(A) = $420,000
Fair value(B) = $520,000
and
Kimmel has equipment (10-year life) with a book value(C) = $272,000
Fair value(D) = $400,000
On December 31, 2014
Paar has equipment with a book value(E) = $294,000
Fair value(F) = $445,200
and
Kimmel has equipment (10-year life) with a book value(G) = $190,400
Fair value(H) = $357,000
Goodwill recognized by Paar corporation on Jan 1, 2012 = $400,000 - $272,000
= $128,000
Goodwill Amortized = [tex]\frac{128,000}{10} \times3[/tex]
= $38,400
Consolidated balance for the Equipment account as of December 31, 2014:
= E + G + Goodwill recognized by Paar corporation - Goodwill Amortized
= $294,000 + $190,400 + $128,000 - $38,400
= $574,000
