Use the Following Information to Answers

question 12

Multiple Choice

Use the following information to answers
Edward Ltd acquires all issued shares in Jacob Ltd for $220 000 paid in cash. Equity of Jacob Ltd consists of $130 000 share capital and $45 000 retained earnings. At acquisition date, Jacob Ltd owns a block of land, which it initially purchased at $200 000. The fair value of the land is $240 000. The carrying amount of Jacob Ltd's property, plant and equipment is $130 000 with accumulated depreciation of $55 000. The fair value of the property, plant and equipment is $95 000.
-Which of the following statements is correct about the above business combination?

• A) There is gain on bargain purchase of $45 000 to be recognised.
• B) There is goodwill of $45 000 to be recognised.
• C) There is gain on bargain purchase of $3000 to be recognised.
• D) There is goodwill of $3000 to be recognised.

---

Definitions:

Low Levels

Conditions or quantities that are significantly less than the average or expected amount.

Long-term Exposure

Prolonged contact with or exposure to a particular environment or substance, often leading to gradual effects on health or system function.

IPM Approach

Integrated Pest Management (IPM) is a sustainable approach to managing pests by combining biological, cultural, physical, and chemical tools in a way that minimizes economic, health, and environmental risks.

Ecological Approach

A perspective or method that emphasizes understanding complex environmental systems and their interactions, often aimed at sustainability.