On Nov. 2th 2020, ABC Corporation paid OMR800,000 for all the issued and outstanding common stock of XYZ, Inc., in atransaction properly accounted for as an acquisition. The book values and fair values of XYZ's assets and liabilities on Nov. 2thwere as followsFair ValueBook ValueCashOMR 80,000OMR 80,000Receivables (net)90,00090,000Liabilities175,000175,000Inventory150,000157,500Plant and equipment (net)460,000410,000The fair value of net assets is:Select one:O a. OMR(275,000)O b. OMR(525,000)OC OMR275,000O d. OMR525,000O e. OMR(280,000)oull lia sI O

Given information is: Fair values: Cash = OMR 80,000 Receivables (Net) = OMR 90,000 Liabilities =…

Answered: The fair value of net assets is:

Business

Accounting

The fair value of net assets is:

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

On Nov. 2th 2020, ABC Corporation paid OMR800,000 for all the issued and outstanding common stock of XYZ, Inc., in a
transaction properly accounted for as an acquisition. The book values and fair values of XYZ's assets and liabilities on Nov. 2th
were as follows
Fair Value
Book Value
Cash
OMR 80,000
OMR 80,000
Receivables (net)
90,000
90,000
Liabilities
175,000
175,000
Inventory
150,000
157,500
Plant and equipment (net)
460,000
410,000
The fair value of net assets is:
Select one:
O a. OMR(275,000)
O b. OMR(525,000)
OC OMR275,000
O d. OMR525,000
O e. OMR(280,000)
oull lia sI O

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