In Reference to the FASB Disclosure Requirements About a Business

question 7

Multiple Choice

In reference to the FASB disclosure requirements about a business combination in the period in which the combination occurs,which of the following is correct?

• A)Firms are not required to disclose the name of the acquired company.
• B)Firms are not required to disclose the business purpose for a combination.
• C)Firms are required to disclose the nature,terms and fair value of consideration transferred in a business combination.
• D)Firms are not required to disclose the details about step acquisitions.

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Definitions:

Net Income

The total earnings of a company after all expenses and taxes have been subtracted from total revenue.

Fiscal Year

It is a one-year period that companies and governments use for financial reporting and budgeting, which does not necessarily align with the calendar year.

Cash Dividends

Disbursements from a corporation's earnings made to its shareholders, often as a share of profits.

Common Stock

A type of equity security that represents ownership in a corporation, with holders typically having voting rights and potentially receiving dividends.