GIJ Ltd Acquired Some Assets from FUG Ltd for Less

question 19

Multiple Choice

GIJ Ltd acquired some assets from FUG Ltd for less than their fair value.The assets do not comprise a business.After allocating the discount to the non-monetary assets there was some discount remaining because the non-monetary assets had been written down to zero.How should GIJ Ltd account for this remaining amount?

• A)Treat it as revenue of the current period
• B)Treat is as revenue over the life of the non-monetary assets acquired
• C)Transfer it to an asset revaluation reserve
• D)Record a contra asset account and debit future depreciation charges against this account.

---

Definitions:

Logarithm

The exponent or power to which a base number must be raised to produce a given number.

Logarithmic Equation

An equation involving logarithms, where the variable is located within the logarithm.

Logarithm

A logarithm is the power to which a number, called the base, must be raised to produce a given number.

Fraction

A numerical quantity that is not whole, representing a part of a whole.