We account for acquisitions in accordance with FASB ASC 805, “Business Combinations” (“ASC 805”), and goodwill in accordance with ASC 350, “Intangibles — Goodwill and Other” (“ASC 350”). For business combinations, the excess of the purchase price over the estimated fair value of net assets acquired in a business combination is recorded as goodwill. In May 2021, we purchased all of the outstanding equity of Cruisers Yachts for an aggregate purchase price of $62.7 million, subject to certain customary closing and post-closing adjustments, and net working capital adjustments including certain holdbacks. The former owners of Cruisers Yachts are subject to certain customary post-closing covenants and indemnities.

The following table summarizes the consideration paid for Cruisers Yachts and the preliminary allocation of the purchase consideration to the estimated fair value of the assets acquired and liabilities assumed at the acquisition date.

	(Amounts in thousands)
Consideration:
Fair value of total consideration transferred	$	61,448

Recognized amounts of identifiable assets acquired and liabilities assumed:
Current assets, net of cash acquired of $5,933	$	29,869
Property and equipment		12,126
Intangible assets		4,602
Current liabilities		(25,283	)
Total identifiable net assets acquired:		21,314
Goodwill	$	40,134
Total	$	61,448

The fair value of current assets acquired includes accounts receivable and inventory of approximately $3.1 million and $26.2 million, respectively. The fair value of current liabilities assumed includes short-term borrowings of approximately $11.7 million, accrued expenses of approximately $10.3 million, and accounts payable of approximately $3.0 million. The intangible assets acquired include the trade name and customer relationships. The purchase price allocations are preliminary pending receipt of final valuation analysis of certain assets from our valuation advisors. The goodwill represents the assembled workforce, acquired capabilities, and future economic benefits resulting from the acquisition. The majority of the goodwill is expected to be deductible for tax purposes. The customer relationships have a weighted average useful life of approximately 2.0 years. The tradename has an indefinite life. Our results for the nine months ended June 30, 2021 include results from Cruisers Yachts between May 2, 2021 and June 30, 2021. Refer to Note 17 for disclosure of the revenues and income from operations. Cruisers Yachts’ financial information for the nine months ended June 30, 2020 and prior to acquisition on May 2, 2021, was not practical to obtain for comparative purposes and as such is not presented because Cruisers Yachts’ historical monthly internal accounting and reporting processes and practices would not provide complete information sufficient for the purposes of this pro forma disclosure.

In October 2020, we purchased all of the outstanding equity of SkipperBud’s for an aggregate purchase price of $55.0 million, subject to certain customary closing and post-closing adjustments, and net working capital adjustments including certain holdbacks. In addition, the former equity owners of SkipperBud’s (“Skippers Sellers”), have the opportunity to earn additional consideration as part of an earnout subject to the achievement of certain pre-tax earnings levels. The maximum amount of consideration that can be paid under the earnout is approximately $9.3 million. The fair value of $8.2 million of the contingent consideration arrangement was estimated by a third party valuation expert by applying an income valuation approach. The earnout was estimated based on forecasted pre-tax earnings as a base scenario (among other assumptions) subject to a Monte Carlo simulation. The Skippers Sellers are subject to

certain customary post-closing covenants and indemnities. The acquisition of SkipperBud’s enhances our sales, brokerage, service and marina/storage presence in the Great Lakes region and West Coast of the Unites States.

The following table summarizes the consideration paid for SkipperBud’s and the preliminary allocation of the purchase consideration to the estimated fair value of the assets acquired and liabilities assumed at the acquisition date.

	(Amounts in thousands)
Consideration:
Cash purchase price and net working capital adjustments, net of cash acquired of $30,615	$	50,261
Contingent consideration arrangement		8,200
Fair value of total consideration transferred	$	58,461

Recognized amounts of identifiable assets acquired and liabilities assumed:
Current assets, net of cash acquired of $30,615	$	50,688
Property and equipment		4,859
Intangible assets		1,978
Current liabilities		(55,427	)
Total identifiable net assets acquired:		2,098
Goodwill	$	56,363
Total	$	58,461

The fair value of current assets acquired includes accounts receivable and inventory of approximately $5.4 million and $42.3 million, respectively. The fair value of current liabilities assumed includes short-term borrowings of approximately $30.5 million, accrued expenses of approximately $14.6 million, and customer deposits of approximately $7.5 million. We recorded approximately $56.4 million in goodwill and approximately $2.0 million of other identifiable intangibles (trade name and customer relationships) in connection with the SkipperBud’s acquisition. The goodwill represents our enhanced geographic reach and brand infrastructure in the Great Lakes region and West Coast of the Unites States. The majority of the goodwill is expected to be deductible for tax purposes. The intangible assets have a weighted average useful life of approximately 3.3 years. For the nine months ended June 30, 2021, SkipperBud’s revenue was approximately $230.1 million and estimated income before taxes was approximately $25.3 million. SkipperBud’s financial information for the nine months ended June 30, 2020 was not practical to obtain for comparative purposes and as such is not presented because SkipperBud’s historical monthly internal accounting and reporting processes and practices would not provide complete information sufficient for the purposes of this pro forma disclosure.

In July 2020, we purchased Northrop & Johnson, a leading superyacht brokerage and services company. In March 2020, we purchased Boatyard, a digital platform with an expansive range of on-demand services to streamline the boating experience by qualified service providers from a smartphone.

In total, current and previous acquisitions have resulted in the recording of $84.3 million and $186.7 million in goodwill and other intangible assets as of September 30, 2020 and June 30, 2021, respectively. In accordance with ASC 350, we test goodwill for impairment at least annually and whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Our annual impairment test is performed during the third fiscal quarter. If the carrying amount of a reporting unit’s goodwill exceeds its fair value we recognize an impairment loss in accordance with ASC 350. As of June 30, 2021, and based upon our most recent analysis, we determined through our qualitative assessment that it is not “more likely than not” that the fair values of our reporting units are less than their carrying values. As a result, we were not required to perform a quantitative goodwill impairment.

Effective May 2, 2021, our reportable segments changed as a result of the Company’s acquisition of Cruisers Yachts, which changed management’s reporting structure and operating activities. We now report our operations through two new reportable segments: Retail Operations and Product Manufacturing. As a result, the Company allocated goodwill to its reporting units within the Company’s two reportable segments.

The following table sets forth the changes in carrying amount of goodwill by reportable segment during the nine months ended June 30, 2021:

(Amounts in thousands)	Retail Operations		Product Manufacturing		Total
Balance as of September 30, 2020	$	84,240	$	-	$	84,240
Goodwill acquired		56,363		40,134		96,497
Foreign currency translation		280		-		280
Balance as of June 30, 2021	$	140,883	$	40,134	$	181,017