Question
Jumbo company acquires all of the stock of Mini company. According to US GAAP, what is the basis to be used for recording the assets
Jumbo company acquires all of the stock of Mini company. According to US GAAP, what is the basis to be used for recording the assets and liabilities of Mini within Jumbo's consolidated financial statements?
A) The fair value of the consideration given up by Jumbo company.
B) The fair value of the shares obtained from the owners of Mini company.
C) The book value of the assets and liabilities of Mini company.
D) The fair value of the consideration given up by Jumbo company plus any direct consolidation costs incurred by Jumbo company.
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Accounting What the Numbers Mean
Authors: David H. Marshall, Wayne W. McManus, Daniel F. Viele,
9th Edition
978-0-07-76261, 0-07-762611-7, 9780078025297, 978-0073527062
