On 8 August 20X3, Alpha Ltd (Alpha) acquired 20 000 shares in Beta Ltd (Beta) that gave Alpha control over Beta in return for 10 000 of its own shares. At that date, Alpha’s shares had a market value of $2.70 each, while Beta’s shares had a market value of $1.30 each. Fees paid to legal advisers for the transaction totalled $2000. What is the fair value of the consideration transferred? a. $29 000 b. $26 000 c. $28 000 d. $27 000
On 8 August 20X3, Alpha Ltd (Alpha) acquired 20 000 shares in Beta Ltd (Beta) that gave Alpha control over Beta in return for 10 000 of its own shares. At that date, Alpha’s shares had a market value of $2.70 each, while Beta’s shares had a market value of $1.30 each. Fees paid to legal advisers for the transaction totalled $2000. What is the fair value of the consideration transferred? a. $29 000 b. $26 000 c. $28 000 d. $27 000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On 8 August 20X3, Alpha Ltd (Alpha) acquired 20 000 shares in Beta Ltd (Beta) that gave Alpha control over Beta in return for 10 000 of its own shares. At that date, Alpha’s shares had a market value of $2.70 each, while Beta’s shares had a market value of $1.30 each. Fees paid to legal advisers for the transaction totalled $2000. What is the fair value of the consideration transferred?
a. $29 000
b. $26 000
c. $28 000
d. $27 000
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