When the purchaser in a business combination pays less then the fair value of the identifiable net assets, such a situation is referred to as a:
A) goodwill purchase.
B) bargain purchase.
C) residual purchase.
D) blanket purchase.

Question

Quizplus · Accepted Answer

When the purchaser pays less than the fair value of the identifiable net assets, it is referred to as a bargain purchase. This means that the purchaser is getting a good deal on the acquisition and is paying less than the assets are worth.

When the Purchaser in a Business Combination Pays Less Then