Chapter_2_10th_word

Chapter_2_10th_word - Chapter 2 solutions 1. A business...

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Chapter 2 solutions 1. A business combination is the process of forming a single economic entity by the uniting of two or more organizations under common ownership. The term also refers to the en- tity that results from this process. 3. Consolidated financial statements represent accounting information gathered from two or more separate companies. This data, although accumulated individually by the or- ganizations, is brought together (or consolidated) to describe the single economic entity created by the business combination. 6. For combinations resulting in complete ownership, the acquisition method allocates the fair value of the consideration transferred to the separately recognized assets ac- quired and liabilities assumed based on their individual fair values. 7. The revenues and expenses (both current and past) of the parent are included within re- ported figures. However, the revenues and expenses of the subsidiary are only consol- idated from the date of the acquisition forward.
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This note was uploaded on 02/21/2012 for the course ACT 492 taught by Professor Ngo during the Fall '11 term at Colorado.

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Chapter_2_10th_word - Chapter 2 solutions 1. A business...

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