Cheers Acquired 100% of Tapp's Shares for $150,000

question 19

Multiple Choice

Cheers acquired 100% of Tapp's shares for $150,000.On the acquisition date,the fair value of the current assets and the net capital assets were $104,000 and $216,000 respectively.The fair value of the liabilities equalled their book value.On Cheers' consolidated statement of financial position,what is the total of its shareholders' equity?

• A)$92,000
• B)$392,000
• C)$484,000
• D)$542,000

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Definitions:

Total Cost

The sum of all costs associated with producing or acquiring an item or service, including direct and indirect expenses.

Contribution Margin

The difference between sales revenue and variable costs, indicating how much revenue contributes to fixed costs and profit.

Sales Volume

The quantity of products or services sold by a business within a specific period.

Contribution Margin

The difference between sales revenue and variable costs, representing the portion of sales revenue that contributes to covering fixed costs and generating profit.