When an existing company creates a new subsidiary and transfers a portion of its assets and liabilities to the new entity:

Muluple Choice

The original company records the difference between the carrying values and the falr values of the assets transferred to the new entity as goodwill.

The original company records a gain or loss on the difference between its carrying values and the fair values of the assets transferred to the new entity.

The new entity records both the assets and llabilites it recelved at far values.

The new entity records both the assets and liabilites it recelved at the carying values of the original company,