When Wayne Ltd Acquired 100% of the Share Capital of Carol

question 44

Multiple Choice

When Wayne Ltd acquired 100% of the share capital of Carol Ltd, the carrying amount of Carol Ltd's machinery was $200 000. The fair value of the machinery on acquisition date was $160 000. The company tax rate was 30%. What is the amount of the business combination valuation reserve that will be recognised on consolidation?

• A) $40 000
• B) $12 000
• C) $28 000
• D) $160 000

Identifying the differences and characteristics of operating leases and finance leases.

Recognizing the role and impact of the contract rate of interest and market rate on bond pricing.

Differentiating between secured and unsecured debt, and understanding the implications for companies and their credit standing.

Calculating and interpreting the debt-to-equity ratio and its significance for assessing a company's financial risk.

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Definitions:

Perimysium

The connective tissue that envelopes muscle fibers into bundles within a muscle.

Muscle Fibers

Cells within muscles that contract to produce movement; made up of proteins actin and myosin.

Aerobic Respiration

A process of producing cellular energy involving oxygen.

ATP

Adenosine triphosphate, a molecule that carries energy within cells, crucial for cellular processes and metabolism.