When a Contingent Consideration Arising from a Business Combination Is

question 20

Multiple Choice

When a contingent consideration arising from a business combination is classified as equity, how is any change in its fair value accounted for if the difference arises due to a change in circumstances?

• A) As an adjustment to the consideration paid for the subsidiary.
• B) As an adjustment to an estimate included in the determination of net income.
• C) As a memorandum entry indicating that additional shares had been issued.
• D) As an adjustment to consolidated contributed surplus.

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Definitions:

Developmental Psychologist

A specialist in psychology who studies the psychological growth of individuals, focusing on how people change over time from infancy through old age.

Personality Psychologist

A psychologist who studies variations in behavior, thinking, and emotion among individuals, focusing on traits and patterns that differentiate one person from another.

Cognitive Psychologist

A specialist in psychology who studies mental processes such as perception, memory, thinking, problem-solving, and language.

Organizational Psychologist

A professional who applies psychological theories and principles to organizations, focusing on improving workplace productivity, and the mental health of employees.