Fredericks Limited Acquired the Identifiable Assets and Liabilities of Nicole

question 11

Multiple Choice

Fredericks Limited acquired the identifiable assets and liabilities of Nicole Limited for $134 000. The items acquired, stated at fair value, are: plant $72 000; inventories $40 000; accounts receivable $18 000; patents $10 000; accounts payable $16 000. The difference on acquisition is:

• A) gain on bargain purchase $10 000.
• B) gain on bargain purchase $16 000.
• C) goodwill of $10 000.
• D) goodwill of $124 000.

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Definitions:

Routinization Of Charisma

The process by which charismatic authority is institutionalized and embedded into a formal structure or organization.

New Religious Movement

A term for faiths that have emerged recently and are distinct from established religious institutions, often seen as unorthodox or modern.

Christian Church

Religious institutions based on Christian belief and practice, encompassing a wide variety of denominations and traditions.

Ecclesia

A system in which a church and the state have a formalized relationship.