Now assume Springfield uses pushdown accounting at the date of acquisition. What amount does it credit to its Pushdown Capital account on its own books?

Question

Quizplus · Accepted Answer

Pushdown accounting involves recording the purchase price of an acquisition on the books of the acquired company. In this scenario, the correct amount to credit to the Pushdown Capital account would be the total purchase consideration, which is typically the fair value of the consideration transferred for the acquisition. Without specific details on the acquisition's financials, the most accurate answer based on the provided options is $4,500,000, assuming it reflects the total acquisition cost or value assigned in this hypothetical scenario.

Now Assume Springfield Uses Pushdown Accounting at the Date of Acquisition