Northern Equipment Corporation purchased all the outstanding common stock of Pioneer Equipment Rental for $5,600,000 in cash. The book values and fair values of Pioneer’s assets and liabilities were...

Northern Equipment Corporation purchased all the outstanding common stock of Pioneer Equipment Rental for $5,600,000 in cash. The book values and fair values of Pioneer’s assets and liabilities were



   Book Value           Fair Value

Accounts Receivable       $ 750,000            $ 650,000
Buildings                         4,100,000             4,800,000
Equipment                         110,000               200,000
Accounts Payable             (750,000)            (750,000)
Net assets
$ 4,210,000          $ 4,900,000




Required:
1. Calculate the amount Northern Equipment should report for goodwill.
2. Record Northern Equipment’s acquisition of Pioneer Equipment Rental.