If the total acquisition value of an acquired not-for-profit entity is greater than the fair value of
Question:
If the total acquisition value of an acquired not-for-profit entity is greater than the fair value of all identifiable net assets of the entity, and that entity’s revenues are not generated by rendering goods or services or from membership dues, then the excess of acquisition value over identifiable net assets is immediately reported:
A) As goodwill on the consolidated Statement of Position.
B) As a pro-rata increase to the identifiable assets and liabilities acquired.
C) As a direct reduction in unrestricted net assets on the Statement of Financial Position.
D) As a reduction in unrestricted net assets on the Statement of Activities.
E) As an increase in other assets on the Statement of Financial Position.
Accounting Business Reporting for Decision Making
ISBN: 9780730302414
4th edition
Authors: Jacqueline Birt, Keryn Chalmers, Albie Brooks, Suzanne Byrne, Judy Oliver