Which of the following is a TRUE statement pertaining to a bargain purchase?

Multiple Choice

• A bargain purchase occurs when the total consideration is less than the net book value of the subsidiary's identifiable net assets.

• A bargain purchase occurs when the total consideration is less than the fair market value of the subsidiary's identifiable net assets.

• A bargain purchase occurs when the total consideration is greater than the fair market value of the subsidiary's identifiable net assets.

• A bargain purchase occurs when the total consideration is greater than the net book value of the subsidiary's identifiable net assets.

HRN Enterprises Inc. (HRN) purchases 80% of the outstanding voting shares of NHR Inc. on January 1, 2018. HRN is using the fair value enterprise (FVE) consolidation method. On that date, which of the following statements pertaining to the non-controlling interest (NCI) is TRUE?

Multiple Choice

• HRN's non-controlling interest (NCI) account will include 20% of the book value of NHR's net assets, 20% of the fair value excess and 20% of the goodwill.

• HRN's non-controlling interest (NCI) account will include 20% of the book value of NHR's net assets.

• HRN's non-controlling interest (NCI) account will include 20% of the acquisition differential on the date of acquisition.

• HRN's non-controlling interest (NCI) account will include 20% of the book value of NHR's net assets and 20% of the fair value excess.