If Shares Are Issued as Part of the Consideration Paid

question 8

Multiple Choice

If shares are issued as part of the consideration paid, transactions costs such as brokerage fees may be incurred. According to AASB 3/IFRS 3 Business Combinations the appropriate accounting treatment for such costs in the records of the acquirer is a debit to:

• A) share capital.
• B) investments.
• C) cash.
• D) acquisition expenses.

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Definitions:

Flexible

Capable of being easily modified to adapt to new conditions or circumstances without significant difficulty.

Customer Value Proposition (CVP)

A business or marketing statement that describes why a customer should buy a product or use a service, focusing on the unique value the product or service provides.

Effective

Refers to something being successful in producing a desired or intended result.

Direct Competition

Occurs when businesses offer the same or similar products or services to the same customer base.