On january 3, 2018, austin corp. purchased 25% of the voting common stock of gainsville co., paying $2,500,000. austin decided to use the equity method to account for this investment. at the time of the investment, gainsville’s total stockholders’ equity was $8,000,000. austin gathered the following information about gainsville’s assets and liabilities: book value fair value buildings (10-year life) $ 400,000 $ 500,000 equipment (5-year life) 1,000,000 1,300,000 franchises (8-year life) $ 0 $ 400,000 for all other assets and liabilities, book value and fair value were equal. any excess of cost over fair value was attributed to goodwill, which has not been impaired. for 2018, what is the total amount of excess amortization for austin’s 25% investment in gainsville?

The total amount of excess amortization for Austin’s 25% investment in Gainsville is $30,000.

Explanation:

total proportions from building, equipment and franchises

= building proportion over 10 years + equipment proportion over 5 years + franchises proportion over 8 years

= ($ 500,000 - $ 400,000)/(10) + (1,300,000 - 1,000,000)/(5) + ($ 400,000-$0)/(8)

= $100,000/10 + $300,000/5 + $400,000/8

= $10,000 + $60,000 + $50,000

=$120,000

Excess Amortization = 25%(total proportions from building, equipment and franchises)

                                  = 25%($120,000)

                                  = $30,000

Therefore, the total amount of excess amortization for Austin’s 25% investment in Gainsville is $30,000.

the most important factor in the

work process or industry is to retain the interest of the employee. and to

retain them, their salary or profit must be adjusted to the best value. unless

the employee does not do his job properly, employees must receive bonuses or

benefits to ensure them to stay in the company. it will actually make them stay

longer, make them feel important and reduce costs for hiring new employees.

explanation:

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