Question
QUESTION 2 When negative goodwill occurs in a business combination calculation, a. The negative goodwill is considered an impairment. b. The value is allocated first
QUESTION 2
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When negative goodwill occurs in a business combination calculation,
a. The negative goodwill is considered an impairment.
b. The value is allocated first to reduce proportionately (according to market value) non-current assets, then to non-monetary current assets, and any negative remainder is classified as a deferred credit.
c. allocated first to reduce proportionately (according to market value) non-current assets, and any negative remainder is classified as an extraordinary gain.
d. allocated first to reduce proportionately (according to market value) non-current, depreciable assets to zero, and any negative remainder is classified as a deferred credit.
QUESTION 4
Robin Corporation purchased 150,000 previously unissued shares of Nest Inc's $10 par value common stock directly from Nest for $3,400,000. Nest's stockholder's equity immediately before the investment by Robin consisted of $3,000,000 of capital stock and $2,600,000 in retained earnings. What is the book value of Robin's investment in Nest?
| a. | $1,500,000 | |
| b. | $1,680,000 | |
| c. | $2,800,000 | |
| d. | $3,000,000 |
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