Central States Telecom provides communication in Iowa, Nebraska, the Dakotas and Montana. Central

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P10-33A  Central States Telecom provides communication in Iowa, Nebraska, the Dakotas and Montana. Central States purchased goodwill as part of the acquisition of Sheldon Wireless Company, which had the following figures:

 

Book of Value Assets--600,000

Market Value of Assets---900,000

Liabilities---540,000

 

 

 

Required:

 

1. Journalize the entry to record Central States purchase of Sheldon Wireless for $300,000 cash plus a $400,000 note payable.

 

2. What special asset does Central States acquisition of Sheldon Wireless identify? How should Central States Telecom account for this asset after acquiring Sheldon Wireless? Explain in detail

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