20231125917

if share issuance cost count as acqusition related costs?

In a business combination achieved in stages, if the acquisition date fair value of the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities of the acquiree is higher than the aggregate of the (1) acquisition date fair value of the consideration transferred by the acquirer; (2) amount of noncontrolling interest measured at fair value or proportionate share; and (3) acquisition date fair value of acquirer's previously held equity interest in the acquire, the difference shall be accounted for by the acquirer in its consolidated statement of financial position as:A. GoodwillB. Deduction directly to retained earningsC. Expense as incurredD. Gain on bargain purchase

Which of the following statements is true regarding the acquisition method of accounting for a business combination? a. Assets of the acquired company are recorded at book values. b. Assets of the acquired company are recorded at fair value, but only if the acquisition cost equals or exceeds fair value of the subsidiary's net assets. c. Assets of the acquired company are recorded at fair values regardless of the acquisition cost. d. Consulting costs related to the combination reduce additional paid-in capital.

True or False Pls indicate if the statements are True or False. 1. All allocated excess/purchase differentials are amortized. 2. Allocated excess/purchase differential amortizations are the allocation over time of the difference between the market value and the book value of the subsidiary’s assets and liabilities at the acquisition date. 3.

Which of the following is not an application of the acquisition method? a. Measuring the non-controlling interest at the non-controlling interest’s proportionate share in the acquiree’s net identifiable assets or fair value, whichever is higher. b. Measuring the consideration transferred at fair value. c. Identifying the acquirer which is the entity that obtains control over another business in a business combination. d. Determining the acquisition date which is the date the acquirer obtains control over acquiree.

S1: Under the acquisition method, if the fair values of identifiable net assets exceed the value implied by the purchase price of the acquired company, the excess should be accounted for goodwill. S2: With an acquisition, direct and indirect expenses are considered a par of the total cost of the acquired company. Both statements are Only S1 is Only S2 is Both statements are 2. Following the completion of a business combination in the form of a statutory consolidation, what is the balance in the new corporation’s Retained earningsaccount? The acquirer retained earnings accountbalance Thesum of the acquirer and acquiree retained earnings account  The acquiree retained earnings accountbalance Zero 3. S1: The acquisition-related costs in a business combination to be expensed immediately include cost of issuing debt securities. S2: In a business combination any “gain on bargain purchase” shall be recognized in other comprehensive income. Only S2 is Both statements are Both statements…

The underlying equity of an investment at acquisition: Question 6Answer a. Is recorded in the investment account under the equity method b. Is equal to the book value of the investee's net assets times the percentage acquired C. Minus the cost of the investment is assigned to goodwill d. Is equal to the fair value of the investee's net assets times the percentage acquired

PLEASE EXPLAINATION FULL DETAILS.

Statement I: Gain on bargain purchase is included in the consolidated balance of shareholders’ equity at the date of acquisition.Statement II: All business combination expenses, direct, indirect, and share-issue costs are deducted in the consolidated balance of shareholders’ equity at the date of acquisition.   True, False False, False True, True False, True

The underlying equity of an investment at acquisition: Question 10Answer a. Is equal to the fair value of the investee’s net assets times the percentage acquired b. Is equal to the book value of the investee’s net assets times the percentage acquired c. Is recorded in the investment account under the equity method d. Minus the cost of the investment is assigned to goodwill

A business combination resulting to a goodwill is accounted using acquisition method. In the consolidated balance sheet at the date of acquisition, which of the following statement about retained earnings (RE) is TRUE? A. RE is equal to RE of the acquirer plus unadjusted net income of the acquiree. B. RE is equal to RE of the acquirer only. C. RE is equal to the sum of the RE of the acquirer and acquiree. D. RE is equal to RE of the acquirer plus adjusted income of subsidiary net of minority interest in subsidiary’s net income.

1. At the date of an acquisition which resulted to either goodwill or gain on bargain purchase, the acquisition method: A. Consolidates the subsidiary's assets and liabilities at book value. B. Consolidates the subisdiary's assets at fair value and libailities at book value. C. Consolidates the subsidiary's assets at book value and liabilities at fair value. D. Consolidates the subsidiary's assets and liabilities at fair value. 2. The consideration transferred in a business combination will most likely include which of the following? A. The transaction price in an arrangement that is primarily for the benefit of the acquirer or the combined entity. B. A contingent liability with an acquisition-date fair value but imposes an improbable outflow that the acquirer assumes in a business combination. C. The "off-market" value of a reacquired right. D. The acquisition-date fair value of a contingent consideration that is dependent upon the occurrence of a possible, but not probable,…

Step 5. Determining goodwill or a gain on bargain purchase. At the acquisition date, the acquirer should recognize goodwill arising in a business combination. Goodwill is measured as the excess of (a) over (b) below: (a) the fair value of purchase considerations/cost of business combination transferred by the acquirer; (b) the net amount of identifiable assets acquired and the liabilities assumed at the acquisition-date. The excess of the cost of business combination over the fair value of net assets acquired represents goodwill. After initial recognition, goodwill is not subject to amortization. The standard-setting bodies consider that the useful life of acquired goodwill and the pattern in which it diminishes are not possible to predict, and thus the amount of goodwill amortized in any given period is an arbitrary estimate. Amortizing goodwill over an arbitrary period fails to provide useful information. Therefore, goodwill should not be amortized; rather it should be subject to an…