The Fair Value of Assets and Liabilities of the Acquired

question 26

Multiple Choice

The fair value of assets and liabilities of the acquired entity is to be reflected in the financial statements of the combined entity. When the acquisition takes place over a period of time rather than all at once, at what time is the fair value of the assets and liabilities of the acquired entity determined under SFAS 141R?

• A) the date the interest in the acquiree was acquired.
• B) the date the acquirer obtains control of the acquiree
• C) the date of acquisition of the largest portion of the interest in the acquiree.
• D) the date of the financial statements.

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Definitions:

Quantity Supplied

The amount of a good or service that producers are willing and able to sell at a given price over a specific period of time.

Equilibrium Price

The Equilibrium Price is the market price at which the quantity of goods supplied is equal to the quantity of goods demanded.

Market Price

The current value at which an asset or service can be bought or sold in the open market.

Quantity Demanded

The total amount of a good or service that consumers are willing and able to purchase at a specific price, at a given time.