Business combination: Business combination refers to the combining of one or more business organizations in a single entity. The business combination leads to the formation of combined financial statements. After business combination, the entities having separate control merges into one having control over all the assets and liabilities. Merging and acquisition are types of business combinations. Push-down accounting: It refers to process about subsidiary’s recording of the fair-value allocations as well as subsequent amortization in its books of accounts. The fair value of the asset: The fair value of the asset is the amount at which two parties may enter into an agreement with an open hand. : Identify the accounting methods which would be recommended if the deals are completed.

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Chapter 2, Problem 2.1.2C

To determine

Business combination:

Business combination refers to the combining of one or more business organizations in a single entity. The business combination leads to the formation of combined financial statements. After business combination, the entities having separate control merges into one having control over all the assets and liabilities. Merging and acquisition are types of business combinations.

Push-down accounting:

It refers to process about subsidiary’s recording of the fair-value allocations as well as subsequent amortization in its books of accounts.

The fair value of the asset:

The fair value of the asset is the amount at which two parties may enter into an agreement with an open hand.

:

Identify the accounting methods which would be recommended if the deals are completed.

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