Homework Answers
d.an asset or stock acquisition.
asset acquisition means:100% of the assets of target entity are acquired.
stock acquisition means purchasing the controlling interest i.e atleast 50% of the stock of target entity are acquired.
a business combination can be either inform of asset acquisition or stock acquisition.
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7) Business combinations may be negotiated as a) an asset acquisition b) a stock acquisition c)...
How does AASB 3/IFRS 3 Business Combinations affect the acquisition analysis?
How does AASB 3/IFRS 3 Business Combinations affect the acquisition analysis?
At what value should the following be recorded? Acquisition of a plant asset for cash. Acquisition...
At what value should the following be recorded? Acquisition of a plant asset for cash. Acquisition of a plant asset in exchange for stock. Exchanging plant asset(s) for other plant asset(s). Donation of a plant asset.
QUESTION 14 Research and development is a driver of business combinations for all of the following...
QUESTION 14 Research and development is a driver of business combinations for all of the following reasons except? a. Lower operating costs. b. Acquisition of intangible assets. c. Operating loss carryforwards. d. Reduced business risk of acquiring established product lines.
Which statement is true concerning U.S. GAAP versus IFRS reporting for business combinations? A. U. S....
Which statement is true concerning U.S. GAAP versus IFRS reporting for business combinations? A. U. S. GAAP and IFRS both require capitalization of in-process R&D as an identifiable intangible asset. B. U.S. GAAP and IFRS both require all asset and liability valuation corrections to be reported in income. C. U.S. GAAP requires recognition of an earnout as part of initial acquisition cost, while IFRS requires an earnout to be recorded only when it is paid. D. U.S. GAAP expenses consulting...
Treasury stock is classified as: A. An asset account B. A contra asset account C. A...
Treasury stock is classified as: A. An asset account B. A contra asset account C. A contra equity account D. A liability account Prior period adjustments are reported in the: A. Multiple-step income statement B. Balance sheet C. Statement of retained earnings D. Statement of cash flows Changes in accounting estimates are: A. Considered accounting errors B. Accounted for with a cumulative "catch-up" adjustment C. Extraordinary items D. Accounted for in current and future periods The Discount on Bonds Payable...
Briefly explain the similarities and differences in the two types of business combination: net asset acquisition...
Briefly explain the similarities and differences in the two types of business combination: net asset acquisition and equity acquisition.
IFRS 3 outlines the accounting requirements for business combinations. Which of the following statements is correct?...
IFRS 3 outlines the accounting requirements for business combinations. Which of the following statements is correct? Multiple Choice The new entity method can only be used when cash is the sole consideration offered by the acquirer in a business combination. The only acceptable method of accounting for business combinations is the new entity method. Companies may choose between the new entity method and the acquisition method when accounting for business combinations. The only acceptable method of accounting for business combinations...
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Which of the following is not an asset account? A) Equipment B) Capital Stock C) Cash D) Retention Receivable
Post-Combination Balance Sheet: Merger and Stock Acquisition Presented below are the LO1 balance sheets of Allen...
Post-Combination Balance Sheet: Merger and Stock Acquisition Presented below are the LO1 balance sheets of Allen Corporation and Benson Corporation, immediately prior to a business combina- tion. The fair values of Benson's reported net assets equal their book values, and previously unreported identifiable intangible assets have a fair value of $200,000. Allen Corp. Benson Corp Cash.. . $1.000,000 600,000 1,200,000 50,000 150,000 400,000 Total assets Current liabilities. $2,800,000 $600,000 . .. . . 300,000 600,000 200,000 900,000 800,000 $100,000 250,000...
A) B) C) D) The TropicalFlowers Company is evaluating an asset that may increase sales by...
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The TropicalFlowers Company is evaluating an asset that may increase sales by $120,000 every year for 4 years. There is no expected change in net operating working capital. The company's cost of capital is 6%. The proposed asset costs $400,000, will require $20,000 to modify for operations, and falls in the 3-year class MACRS for depreciation rates:.33, .45, 15, and .07 for years 1 through 4, respectively. At the end of the 4 years, it is...
Post-Combination Balance Sheet: Merger and Stock Acquisition Presented below are the LO1 balance sheets of Allen Corporation and Benson Corporation, immediately prior to a business combina- tion. The fair values of Benson's reported net assets equal their book values, and previously unreported identifiable intangible assets have a fair value of $200,000. Allen Corp. Benson Corp Cash.. . $1.000,000 600,000 1,200,000 50,000 150,000 400,000 Total assets Current liabilities. $2,800,000 $600,000 . .. . . 300,000 600,000 200,000 900,000 800,000 $100,000 250,000...
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The TropicalFlowers Company is evaluating an asset that may increase sales by $120,000 every year for 4 years. There is no expected change in net operating working capital. The company's cost of capital is 6%. The proposed asset costs $400,000, will require $20,000 to modify for operations, and falls in the 3-year class MACRS for depreciation rates:.33, .45, 15, and .07 for years 1 through 4, respectively. At the end of the 4 years, it is...
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