Answered: This distinguishes a business…

This distinguishes a business combination from other types of investment transactions. a. Obtaining of control b. Acquisition of assets c. All of these d. Acquisition of stocks

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter2: Introduction To Financial Statements

Section: Chapter Questions

Problem 17MC: Working capital is an indication of the firms ________. A. asset utilization B. amount of noncurrent...

See similar textbooks

Related questions

Q: _____is that business activity which is concerned with the acquisition and conversion of capital…

A: Business activity is a term used for any activity which is related to making or earning profit and…

Q: A statement of financial position allows investors to assess all of the following except the___.…

A: Statement of financial position refers to the statement that represents the value of all the assets,…

Q: What documents would a company need to correctly account for its investment securities, and what…

A: Investment Securities: Investment securities can be stated as those securities that are acquired…

Q: Financial management mainly focuses on Select one: O a. Efficient management of every business O b.…

A: Financial management plays a crucial role in managing money in all areas of life. It consists of…

Q: ) Explain liquid asset management as it relates to a financial institu

A: As per company policy, it s only possible to solve the first part.

Q: Defined by IFRS 2 as a share-based payment transaction in which the entity acquires goods or…

A: The question involves transaction in which the entity acquires goods or services either as…

Q: In a business combination, the acquiree is the business that: Select one: a. Finances the business…

A: Acquisition: The acquisition is the term that is used when one company acquires or purchases shares…

Q: corporate

A: SOLUTION:- Non -Operating Assets -There are certain asset which do not contribute to the day to day…

Q: The primary objective of financial reporting is to provide informationa. useful for making…

Q: Capital market research relies on the underlying assumptions that equity market is efficient. would…

A: Hi, since you have posted multiple questions, we will answer only the first one, as per authoring…

Q: The primary objective of financial management Can be in the form of a. Maximise the entity’s asset…

A: Financial management means management of funds or finance in the business. It is about making future…

Q: 1. Capital allocation process The capital allocation process involves the transfer of capital among…

A: Capital allocation process is the process of allocation of capital among different entities and…

Q: 1. What is an intercorporate share investments? a) Significance Influence b) Financial Assets vs…

A: Investments are the resources that the entity or individual has when capital is allocated for a…

Q: Transaction costs are capitalized when acquiring investment in equity or debt securities, except…

A: Transaction costs are required costs incurred while sale or purchase of equity or debt security. In…

Q: A share-based payment transaction is one in which an entity receives goods or services and pays for…

A: Share -based payment: These payments are made by the entity when the goods or services are purchased…

Q: A firm's cash flow from investing activities includes: Select one: A. Cash received from the sale of…

A: Cash flow from Investing Activities: This system is based on the sale and purchase of non-current…

Q: The acquisition of assets by issuing securities would be classified as an operating activity. an…

A: Issuing securities for the acquisition of assets doesn't involve any cash flows.

Q: Investments in equity instruments are financial assets because they are Group of answer choices…

A: Solution: As per IAS, Financial assets are those assets that is: 1. Cash 2. an equity instrument of…

Q: Using the equity method for reporting strategic investments, how does investment revenue and…

A: A company uses equity method for reporting investments when its ownership interest in the investee…

Q: PROBLEM 1: MULTIPLE CHOICE 1. During the period, an entity acquires an investment. The entity has a…

A: If Investment's business model is to hold to collect and sell, then it shall be measured at fair…

Q: What are the different financial risks in business acquisition and combination?

A: Financial risk is the risk that the company has overpaid or has got more leverage than required or…

Q: When the economic method is used, the investor will recognize the investment income when: Select…

Q: Investors sometimes transfer assets to investee’s shareholders other than cash and investor’s stock.…

A: Acquisition Now a days in the business circle acquisition is very common in nature, the main reason…

Q: Cash flow methodology should distinguish between a new capital-intensive business and a more mature…

A: According to the cash flow methodology must distinguish between the cash flow in new capital…

Q: The primary measurement unit used for assessing the value of one's stake in an investment company…

A: Net Asset Value is defined as the value of the assets of entity and minus the liabilities value,…

Q: y method for the preparation of consolidated financial statements in order to make investment…

A: Argue for using the equity method for the preparation of consolidated financial statements in order…

Q: Which statement is incorrect regarding classification of financial assets? a. An entity can…

A: Financial Assets: The financial assets refers to contractual agreement between two parties for a…

Q: setup in the finance system that ensures clear ownership of responsibilities. A. Macroprudential…

A: Finance system is nothing but group or cluster of institutions, such as Banking Company, Investment…

Q: The classification and therefore subsequent measurement of financial assets depends on.? Select one:…

A: Hi student Since there are multiple questions, we will answer only first question.

Q: investments in equity instruments are financial assets because they are a) cash equivalents b)…

A: Financial assets are the assets that are derived from contractual claims. It is a more liquid asset…

Q: whether an investing firm is the primary beneficiary in a variable-interest entity. When is an…

A: Since you have posted multiple questions, we will answer the first one for you. If you want a…

Q: Select the assumption, principle or constraint that most appropriately justifies these procedures…

A: The accounting principle represents the rules and guidelines that are needed to be followed by the…

Q: All of the following statements are objective of financial reporting, except: О А. Provide…

A: Financial reporting means reporting on financial data that indicates the financial health of an…

Q: Explain how the investment account is affected byinvestee activities under the equity method.

A: Equity method: Equity method is the method used for accounting equity investments which claim a…

Q: method, an investment in associate or joint venture is initially and subsequently measured at…

A: Answer - Option B Initial measurement - Cost Subsequent measurement- Cost, adjusted for the investor…

Q: The capital allocation process involves the transfer of capital among different entities that…

A: Capital Allocation Process is a process of Enhancing the firm long term financial condition and…

Q: What are the similarities between the income, market, and asset approaches to business valuation?

A: Business valuation is the measure of the economic value of a company for the benefit of the owners.…

Q: This distinguishes a business combination from other types of investment transactions. Obtaining of…

A: Business combination is defined as the transaction under which the acquirer gains the control over…

Q: The cost of registering equity securities in a business combination should be recorded as

A: Equity securities are those stock or securities which provides ownership rights in the company.…

Concept explainers

Bookkeeping

Bookkeeping is the process of recording the financial transactions of a company on a regular basis. With the process of bookkeeping, companies can track important financial information that helps management in making crucial decisions.

Question

This distinguishes a business combination from other types of investment transactions.

a. Obtaining of control

b. Acquisition of assets

c. All of these

d. Acquisition of stocks

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Investments in equity instruments are financial assets because they are Group of answer choices Cash equivalents. Contractual rights to receive cash or another financial asset from another entity. Equity instruments of another entity. Contractual rights to exchange financial assets or financial liabilities with another entity under conditions that are potentially favorable to the entity.
investments in equity instruments are financial assets because they are a) cash equivalents b) contractual rights to receive cash or another financial asset from another entity c) contractual rights to exchange financial assets or financial liabilities with another entity under conditions that are potentially favourable to the entity d) an equity instrument of another entity
The following terms were introduced in this chapter: Strategic investments Non-strategic investments Investments at fair value through profit or loss (FVTPL) Investments at amortized cost (AC) Match each term with the following definitions: _________ Debt securities that are held to earn interest income _________ Investments purchased to influence or control another company _________ Debt or equity investments that require holding gains or losses to be included in the determination of the company’s profit or loss. _________ Investments purchased mainly to generate investment income
A statement of financial position allows investors to assess all of the following except the___. WHICH OPTION IS CORRECT? a. capital structure of the enterprise b. liquidity and financial flexibility of the enterprise c. efficiency with which enterprise assets are used d. net realizable value of enterprise assets
A statement of financial position allows investors to assess all of the following except the___. Select one: a. capital structure of the enterprise b. liquidity and financial flexibility of the enterprise c. efficiency with which enterprise assets are used d. net realizable value of enterprise assets
What is a STO Group of answer choices A security token represents an investment contract into an underlying investment asset such as equity shares, debt (ie bonds), funds and real estate investment trusts (REIT) A share token that represents shares in the product sold A share of a stock traded opinion A sale of a soft token opinion
What are the four different methods of accounting for investment? Please concisely explain the four different methods of accounting for investment. Please show the different debits and credits to an investment account under the equity method of accounting. Please concisely explain how the excess investment cost over book value is allocated. When is the intra-entity’s profits recognized on transfers between the investor and investee? What is the controlling interest percentage for a consolidated accounting financial statement? What is the controlling interest percentage for a business combination tax return? what does a “downstream” sale of inventory refer to and when is the profit recognized? What does an “upstream” sale of inventory refer to and when is the profit recognized? What is the difference between accounting under the “partial” equity and “full equity method?
Discuss the concept of accounting for business combinations and the different methods used, such as the acquisition method and the pooling of interests method.
Which of the following statements are true regarding financial instruments? (i) Financial instruments comprise of both financial assets and financial liabilities (ii) A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. (iii) Primary instruments are financial instruments in which an investor has made an investment in a specific instrument. (iv) A derivate instrument is normally linked to a primary instrument and transfers the financial risks inherent in the underlying primary instrument. Select one: a. (i) and (ii) b. (i) and (iii) only c. (i) only d. (i), (ii), (iii) and (iv)
What are the different financial risks in business acquisition and combination?
Working capital is an indication of the firms ________. A. asset utilization B. amount of noncurrent liabilities C. liquidity D. amount of noncurrent assets
Comprehensive income: includes transactions that affect stockholders equity with the exception of those transactions that involve owners. is considered an appropriation of retained earnings. includes all transactions that are under managements control. is the result of all events and transactions reported on the income statement.