ACC 304 All Assignments ACC 304 All Assignments | Page 215

44. The reason goodwill is sometimes referred to as a master
valuation account is because
a. it represents the purchase price of a business that is about to be
sold.
b. it is the difference between the fair value of the net tangible and
identifiable intangible assets as compared with the purchase price of
the acquired business.
c. the value of a business is computed without consideration of
goodwill and then goodwill is added to arrive at a master valuation.
d. it is the only account in the financial statements that is based on
value, all other accounts are recorded at an amount other than their
value.
45. Easton Company and Lofton Company were combined in a
purchase transaction. Easton was able to acquire Lofton at a bargain
price. The sum of the fair values of identifiable assets acquired less the