On October 1, 20X3, Green Corporation paid $450,000 for all of Yellow Company's outstanding common stock. On that date, the book values and fair values of Yellow's recorded assets and liabilities were as follows:
Book Value Fair Value
Cash and Receivables $75,000 $75,000
Inventory 155,000 160,000
Buildings and Equipment (net) 260,000 320,000
Liabilities (150,000) (150,000)
Net Assets $340,000 $405,000
Based on the preceding information, the differential implicit in this acquisition is
$0.
$45,000.
$65,000.
$110,000.
Based on the preceding information, what amount should be allocated to goodwill in the consolidated balance sheet prepared immediately after the combination?
$110,000.
$65,000.
$45,000.
$0.