In a transaction accounted for using the acquisition method where consideration transferred exceeds book value of the acquired company, which statement is true for the acquiring company with regard to its investment?
a) Net assets of the acquired company are revalued to their fair values and any excess of consideration transferred over fair value of net assets acquired is allocated to goodwill
b) Net assets of the acquired company are maintained at book value and any excess of consideration transferred over book value of net assets acquired is allocated to goodwill.
c) Acquired assets are revalued to their fair values. Acquired liabilities are maintained at book value. Excess is allocated to goodwill.
Answers (1)
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “In a transaction accounted for using the acquisition method where consideration transferred exceeds book value of the acquired company, ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
2 - The market has an expected rate of return of 11.2 percent. The long-term government bond is expected to yield 5.8 percent and the U. S. Treasury bill is expected to yield 3.9 percent. The inflation rate is 3.6 percent.
Answers (1)
Buying used cars is a good way to avoid depreciation. a. True b. False
Answers (1)
Malcolm's parents wanted him to be part of the family business-and malcolm planned to do so. then, at age 17, he decided to leave the business to study to be a lawyer. malcolm resisted
Answers (1)
Jilk Inc.'s contribution margin ratio is 64% and its fixed monthly expenses are $44,500. Assuming that the fixed monthly expenses do not change, what is the best estimate of the company's net operating income in a month when sales are $131,000? a.
Answers (1)
Apex Systems Co. offers its services to residents in the Seattle area. Selected accounts from the ledger of Apex Systems Co. for the fiscal year ended December 31, 2016, are as follows: Bart Nesbit, Capital Dec. 31 91,200 Jan. 1 (2016) 1,340,000 Dec.
Answers (1)
New Questions in Business
2. Winners and losers from free trade Consider the market for meekers in the imaginary economy of Meekertown. In the absence of international trade, the domestic price of meekers is $40. Suppose that the world price of meekers is $39.
Answers (1)
An economic system: A. requires a grouping of private markets linked to one another. B. is a particular set of institutional arrangements and a coordinating mechanism used to respond to the economizing problem. C.
Answers (1)
Grading at a site refers to A) evaluating the existing subsurface conditions of a site. B) evaluating the groundwater conditions at a site. C) compacting the soil to required density. D) None of these.
Answers (1)
A machine with a cost of $130,000, accumulated depreciation of $85,000, and current year depreciation expense of $17,000 is sold for $40,000 cash. The amount that should be reported as a source of cash under cash flows from investing activities is:A.
Answers (1)
Which investment has the highest liquidity and can be converted into cash easily? A - bonds B - mutual funds C - stocks D - certificates of deposit
Answers (2)