In a business combination,which of the following will occur?
A)All identifiable assets and liabilities are recorded at fair value at the date of acquisition.
B)All identifiable assets and liabilities are recorded at book value at the date of acquisition.
C)Goodwill is recorded if the fair value of the net assets acquired exceeds the book value of the net assets acquired.
D)None of the above is correct.

Question

Quizplus · Accepted Answer

According to accounting rules, in a business combination, all identifiable assets and liabilities are recorded at fair value at the date of acquisition. And goodwill is calculated as the excess of the fair value of the net assets acquired over the consideration paid. Therefore, choices B and C are both incorrect.

In a Business Combination,which of the Following Will Occur