What is the requirement with respect to the allocation of the cost of a business acquisition? a. Cost to be allocated based on carrying amount. b. Cost to be allocated based on original cost c. Cost to be allocated based on fair value. d. None of these
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What is the requirement with respect to the allocation of the cost of a business acquisition?
a. Cost to be allocated based on carrying amount.
b. Cost to be allocated based on original cost
c. Cost to be allocated based on fair value.
d. None of these
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- The identifiable assets acquired and liabilities assumed in a business combination are generally measured at: a. Acquisition-date fair values b. Previous carrying amounts c. Fair value less cost to sell d. CostHello, I need your help. How should acquisition related costs such as due diligence and legal costs be accounted for? expensed as incurred As part of the total consideration As a reduction in equity As a deferred assetIn a business combination, goodwill is defined as the excess of acquisition cost over the a. fair value of assets acquired. b. fair value of assets acquired less the liabilities assumed. c. net book value of assets acquired. d. book value of assets acquired less the liabilities assumed.
- if the value implied by the purchase price of an acquired company exceeds the fair values of the identifiable net assets, the excess should be a. allocated to reduce any previously recorded goodwill and classify any remainder as an ordinary gain b. allocated to reduce current and longlived assets c. allocated to gain on acquisition d. allocated to goodwillIf the asset or disposal group is acquired as part of a business combination, it shall be measured at: A. The lower of “Cost” and “Fair value, less costs to sell’ B. Fair value, less costs to sell C. Cost D. The higher of “Cost” and “Fair value, less costs to sell’Which of the following accounting treatments for costs related to business combination is incorrect? Group of answer choices a. Acquisition related costs such as finder’s fees; advisory, legal, accounting, valuation and other professional and consulting fees; and general administrative costs, including the costs of maintain an internal acquisitions department shall be recognized as expense in the Profit/Loss in the periods in which the costs are incurred. b. The costs related to issuance of financial liability at fair value through profit or loss shall be recognized as expense while those related to issuance of financial liability at amortized cost shall be recognized as deduction from the book value of financial liability or treated as discount on financial liability to be amortized using effective interest method. c. The costs related to the organization of the newly formed corporation also known as pre-incorporation costs shall be capitalized as goodwill or deduction from…
- f the value implied by the purchase price of an acquired company exceeds the fair values of identifiable net assets, the excess should be A. Allocated to reduce long-lived assets B. Allocated to reduce current and long-lived assets C. Allocated to reduce any previously recorded goodwill and classify any remainder as an ordinary gain. D. Allocated goodwillIf the value implied by the purchase price of an acquired company exceeds the fair values of identifiable net assets, the excess should be A. Allocated to reduce current and long-lived assetsB. Allocated to reduce long-lived assetsC. Allocated to reduce any previously recorded goodwill and classify any remainder as an ordinary gain.D. Allocated goodwillWhich of the following would not explain the difference between current and non-current assets? A.The future benefit of current assets will generally be used up within the entity's operating cycle B.An expenditure is classified as a non-current asset if it is considered to be material C.The nature and intention of the business can help determine whether an expenditure should be classified as a non-current asset D.An asset is classified as non-current if it is intended to be used within the business for a considerable period of time
- Under what conditions is it appropriate for a businessto use the composite method of depreciation for itsplant assets? What are the advantages and disadvantagesof this method?A transfer from investment property carried at fair value to owner-occupied property shall be accounted for at a. Fair value, which becomes the deemed cost b. Carrying amount c. Fair value less cost of disposal d. Historical costWhich of the following is/are true regarding goodwill achieved through acquisition as part of business combination? Where the acquirer was able to purchase the business at a discount, the excess of the market capitalization over the consideration transferred will be recognized in profit or loss. The acquirer shall recognize goodwill as of the acquisition date measured as the excess of the aggregate of the consideration transferred over the net of the fair values of all the assets acquired and the liabilities assumed Group of answer choices Both statements are true. None of these statements are true. 2 only. 1 only.
