What is bargain purchase, Financial Accounting

Assignment Help:

What is bargain purchase?

Financial assets acquired for less than FMV. In a bargain purchase BC, a corporate entity is acquired by another for an amount that is less than the fair market value of its net assets.

Describe the accounting procedures necessary to record and account for a bargain purchase.

Current accounting rules for business combinations require the acquirer to record the difference between fair value of the acquired net assets and the purchase price as a gain in its net profit and loss account, thereby providing an immediate boost to the acquirer's equity.

 


Related Discussions:- What is bargain purchase

Explain why the operating cycle, The Operating Cycle Two Wheeler Cycle Shop...

The Operating Cycle Two Wheeler Cycle Shop buys all of its bikes from one manufacturer, Baxter Bikes. On average, bikes are on hand for 45 days before Two Wheeler sells them. The c

Which actions are most likely to directly increase cash, Which of the follo...

Which of the following actions are most likely to directly increase cash as shown on a firm's balance sheet? Explain and state the assumptions that underlie your answer. 1. It i

Goodwill-intra company adjustments-group accounts, GOODWILL Previously ...

GOODWILL Previously under IAS 22 on Business combinations, goodwill on consolidation used to be amortized over an estimated period of years. However, IFRS 3 (still on business

What is audit sampling, Q. What is Audit Sampling? Audit Sampling - App...

Q. What is Audit Sampling? Audit Sampling - Application of an AUDIT procedure to less than 100% of items within anaccount BALANCE or class of transactions for purpose of evalua

Foreing branches-branches, FOREING BRANCHES The head office my set up a b...

FOREING BRANCHES The head office my set up a branch in a foreign  country. IAS 21 requires that the results of that  foreign branch to be translated into the local currency for t

Define the term limited company- business ownership, Define the term Limite...

Define the term Limited company- business ownership Limited companies can range in size from quite small to very large. Number of individuals who subscribe capital and become

Explain about material event, Q. Explain about Material event? Subseque...

Q. Explain about Material event? Subsequent Event - Material event which takes place after the end of accounting period and before the publication of an entity's FINANCIAL STAT

Analysis on the profitability, (a) You are working as the CFO of Jeans Co. ...

(a) You are working as the CFO of Jeans Co. The company is currently seeking a new supplier for their goods. There are two main suppliers of choice, XYZ Ltd and ABC Ltd. The contra

Determine the optimum combination of milk and biscuits, 1. Jim buys only mi...

1. Jim buys only milk and biscuits.    (a) In 2004, Jim earns $100, milk costs $2, biscuits cost $4 per dozen. Draw Jim's budget constraint  (b) Now suppose that all prices i

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd