Thad Ltd. acquired 100% of the common shares of Zoe Co. for $560,000. At the time of acquisition, Zoe had the following: $$\begin{array}{lrr}& \text{ Book Value }& \text{ Fair Value }\\ \text{ Identifiable assets }& \$1,484,000& \$1,518,000\\ & & \\ \begin{array}{l}\text{ Identifiable }\\ \text{ liabilities }\end{array}& 980,000& 980,000\end{array}$$ In this acquisition, how much goodwill has been created?

A) $0
B) $22,000
C) $35,000
D) $56,000

Goodwill

The excess of the purchase price paid to acquire a company over the fair value of its identifiable net assets, representing intangibles like brand reputation or customer relationships.

Common Shares

Equity securities representing ownership interests in a corporation, entitling holders to vote on corporate matters and receive dividends.