Amount Of Goodwill To Be Recognized With Merger 544002

On January 1, Richard Company acquired all the net assets of Ulmer Company by issuing bonds with a face value and fair value of $500,000 and cash of $300,000. The fair values of Ulmer’s identifiable net assets equaled their book values, except for buildings and equipment, which had a fair value of $120,000 greater than book value. Balance sheets for the two companies immediately preceding the acquisition were as follows:

Richard Co.Ulmer Co.
Cash$400.000$150,000
Buildings & Equipment$700,000$400,000
Accumulated Depreciation$(300,000)$(150,000)
Other Identifiable Assets$100,000$200,000
Total Assets$900,000$600,000

Liabilities$200,000$100,000
Common Stock$400.000$300,000
Additional Paid-In Capital$160,000$100,000
Retained Earnings$140,000$100,000
Total Liabilities and Equity$900,000$600,000

Based on the information given above, the amount of Goodwill to be recognized in connection with the merger is:

A. 0
B. $180,000
C. $200,000
D. $300,000