Silver Enterprises Has Acquired All Gold Mining in a Merger

question 26

Multiple Choice

Silver Enterprises has acquired All Gold Mining in a merger transaction.The following balance sheets represent the premerger book values for both firms.
Assume the merger is treated as a pooling of interests for accounting purposes.The total assets are _____ and the total equity is _____ on the post-merger balance sheet.

• A) $24,500;$10,500
• B) $24,500;$18,200
• C) $26,300;$10,500
• D) $26,300;$16,600
• E) $27,500;$19,400

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Definitions:

River Terrace

A flat, bench-like structure alongside a river, formed by the river cutting deeply into the land then retreating, leaving a raised platform.

Well-developed Soil

Soil that has undergone extensive formation processes, resulting in distinct layers and rich nutrient content.

Lava Flow

The movement of lava as it pours out and spreads over the land following a volcanic eruption.

Angular Unconformity

An unconformity (ancient erosion surface) in which the older, underlying strata dip more steeply or at a different angle than the younger, overlying strata.