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Which of the following statements regarding the accounting for business combinations is false?

a. Goodwill is the difference between the consideration transferred by the acquirer to the acquiree and the fair value of identifiable assets acquired.
b. The acquirer in a business combination will only recognize the liabilities assumed if they meet the definition of liabilities and are part of the business combination transaction.
c. The identifiable assets acquired, liabilities assumed, and noncontrolling interest in the acquiree are recognized separately from the goodwill arising out of a business combination.
d. Under the acquisition method, the identifiable assets acquired during a business combination are measured at their acquisition- date fair values.

Sagot :

Tundexi

Answer:

Option A

Explanation:

Although goodwill is the difference between the consideration transferred by the acquirer to the acquiree it is not the fair value of the identifiable assets acquired rather it is the fair value of the net assets acquired.

The difference is fair value of identifiable assets is the value of the assets at some point of time which is expected to provide some future benefits.

The fair value of the net assets acquired is the total of the fair value of net assets minus liabilities.

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