1. How are payments to attorneys and accountants by an acquirer of 100% ownership of a subsidiary handled under the purchase method a. as a debit to Additional Paid in Capital b. as a debit to the Investment Account c. as a debit to Operating Expenses d. as a debit to Investment Expense e. as a debit to Other Assets 2. Tall purchased 100% of Small on January 1, 2000 and did not qualify for pooling of interest accounting. It is now December 31, 2018. What method of accounting will Tall use to consolidate Small. a. pooling of interest b. purchase method c. acquisition method d. proportionate method e. parent company method 3. Shoe acquires 100% of Foot and pays a price resulting in a premium over book value of Foot. At date of acquisition, Foot has Notes Payable with fair value higher than book value and Equipment with fair value less than book value. How do the differences between book value and fair value impact the calculation of Goodwill or Gain on Bargain Purchase ? a. Add difference to premium for Notes Payable and add for Equipment b. Add difference to premium for Notes Payable and subtract for Equipment c. Subtract difference from premium for Notes Payable and subtract for Equipment d. Subtract difference from premium for Notes Payable and add for Equipment e. None of the above is accurate 4. What is true at date of acquisition when comparing a statutory merger and an acquisition a. Statutory merger never results in goodwill b. Statutory merger never results in a gain on bargain purchase C. Consolidated totals for balance sheet and income statement will be identical under both statutory merger and acquisition d. Consolidated net income in an acquisition always exceeds net income in statutory merger when parent uses equity method Consolidated net income in an acquisition will be less than net income i 1. How are payments to attorneys and accountants by an acquirer of 100% ownership of a subsidiary handled under the purchase method a. as a debit to Additional Paid in Capital b. as a debit to the Investment Account c. as a debit to Operating Expenses d. as a debit to Investment Expense e as a debit to Other Assets 2. Tall purchased 100% of Small on January 1, 2000 and did not qualify for pooling of interest accounting. It is now December 31, 2018. What method of accounting will Tall use to consolidate Small. a. pooling of interest b. purchase method c. acquisition method d. proportionate method e. parent company method 3. Shoe acquires 100% of Foot and pays a price resulting in a premium over book value of Foot. At date of acquisition, Foot has Notes Payable with fair value higher than book value and Equipment with fair value less than book value. How do the differences between book value and fair value impact the calculation of Goodwill or Gain on Bargain Purchase ? a. Add difference to premium for Notes Payable and add for Equipment b. Add difference to premium for Notes Payable and subtract for Equipment c. Subtract difference from premium for Notes Payable and subtract for Equipment d. Subtract difference from premium for Notes Payable and add for Equipment e. None of the above is accurate 4. What is true at date of acquisition when comparing a statutory merger and an acquisition a. Statutory merger never results in goodwill b. Statutory merger never results in a gain on bargain purchase c. Consolidated totals for balance sheet and income statement will be identical under both statutory merger and acquisition d. Consolidated net income in an acquisition always exceeds net income in a statutory merger when parent uses equity method e. Consolidated net income in an acquisition will be less than net income in a statutory merger when the parent uses the initial value method - 23 @ 1. How are payments to attorneys and accountants by an acquirer of 100% ownership of a subsidiary handled under the purchase method a. as a debit to Additional Paid in Capital b. as a debit to the Investment Account c. as a debit to Operating Expenses d. as a debit to Investment Expense e. as a debit to Other Assets 2. Tall purchased 100% of Small on January 1, 2000 and did not qualify for pooling of interest accounting. It is now December 31, 2018. What method of accounting will Tall use to consolidate Small. a. pooling of interest b. purchase method c. acquisition method d. proportionate method e. parent company method 3. Shoe acquires 100% of Foot and pays a price resulting in a premium over book value of Foot. At date of acquisition, Foot has Notes Payable with fair value higher than book value and Equipment with fair value less than book value. How do the differences between book value and fair value impact the calculation of Goodwill or Gain on Bargain Purchase ? a. Add difference to premium for Notes Payable and add for Equipment b. Add difference to premium for Notes Payable and subtract for Equipment c. Subtract difference from premium for Notes Payable and subtract for Equipment d. Subtract difference from premium for Notes Payable and add for Equipment e. None of the above is accurate 4. What is true at date of acquisition when comparing a statutory merger and an acquisition a. Statutory merger never results in goodwill b. Statutory merger never results in a gain on bargain purchase C. Consolidated totals for balance sheet and income statement will be identical under both statutory merger and acquisition d. Consolidated net income in an acquisition always exceeds net income in statutory merger when parent uses equity method Consolidated net income in an acquisition will be less than net income i 1. How are payments to attorneys and accountants by an acquirer of 100% ownership of a subsidiary handled under the purchase method a. as a debit to Additional Paid in Capital b. as a debit to the Investment Account c. as a debit to Operating Expenses d. as a debit to Investment Expense e as a debit to Other Assets 2. Tall purchased 100% of Small on January 1, 2000 and did not qualify for pooling of interest accounting. It is now December 31, 2018. What method of accounting will Tall use to consolidate Small. a. pooling of interest b. purchase method c. acquisition method d. proportionate method e. parent company method 3. Shoe acquires 100% of Foot and pays a price resulting in a premium over book value of Foot. At date of acquisition, Foot has Notes Payable with fair value higher than book value and Equipment with fair value less than book value. How do the differences between book value and fair value impact the calculation of Goodwill or Gain on Bargain Purchase ? a. Add difference to premium for Notes Payable and add for Equipment b. Add difference to premium for Notes Payable and subtract for Equipment c. Subtract difference from premium for Notes Payable and subtract for Equipment d. Subtract difference from premium for Notes Payable and add for Equipment e. None of the above is accurate 4. What is true at date of acquisition when comparing a statutory merger and an acquisition a. Statutory merger never results in goodwill b. Statutory merger never results in a gain on bargain purchase c. Consolidated totals for balance sheet and income statement will be identical under both statutory merger and acquisition d. Consolidated net income in an acquisition always exceeds net income in a statutory merger when parent uses equity method e. Consolidated net income in an acquisition will be less than net income in a statutory merger when the parent uses the initial value method - 23 @