Book 2, pg 183, Prob 27

27: The solution states that the net book value of recorded assets is 580? How the F? How come Equity is same thing as net book value of recorded assets? I thought net book value of assets is 1070 in this case, since fair value = book value.

Aquisition method: When looking for goodwill, you do: Price of aqusition minus Fair market value of NET ASSET. NET ASSET is ASSET-LIABILITY ie. net asset is just straight up equity. if i recall, equity of Target is 580. 320/0.5 -580 gives you the excess patent value of 60.