Which of the Following Statements Is Incorrect

question 28

Multiple Choice

Which of the following statements is incorrect?

• A) The business combination valuation reserve is an account recorded in the subsidiary's records.
• B) The acquisition analysis may include the recognition of assets and liabilities not recognised in the subsidiary's records.
• C) The acquisition analysis will determine whether any goodwill or gain on bargain purchase has arisen as a part of the business combination.
• D) An acquisition analysis is prepared at acquisition date to identify the identifiable assets and liabilities of the subsidiary at fair value.

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Definitions:

Variable Overhead Efficiency Variance

The difference between the expected and actual variable overhead costs, based on the efficient use of production resources.

Variable Overhead Efficiency Variance

The difference between the budgeted and actual variable overhead costs, attributable to differences in the efficiency of utilizing resources.

Variable Overhead Rate Variance

The discrepancy between the actual incurred variable overhead and the anticipated variable overhead as per standard costing.

Lubricants

Substances that are applied to surfaces to reduce friction and wear between moving parts.