CERTYNEX IFRS ACADEMY

Orne SA acquires 100% of Sèvre SA for 5,000,000. Sèvre has assets with a carrying amount of 4,000,000, measured at a fair value of 4,900,000, and liabilities assumed of 1,500,000 (carrying amount and fair value identical). Case convention: No deferred tax or particular item is to be considered. What is goodwill?

1,600,000, i.e. 5,000,000 less identifiable net assets at fair value of 3,400,000.

2,500,000, i.e. 5,000,000 less Sèvre's net book value calculated with carrying amounts.

100,000, i.e. 5,000,000 less the fair value of the assets alone, without deducting the liabilities assumed.

3,400,000, i.e. identifiable net assets at fair value taken as the amount of goodwill.