Identify and explain the reasons why total purchase price paid in acquiring a subsidiary company is rarely equal to its total net assets/equity as reported in its audited financial statements. (32 marks) You may include the following in your discussion: Financial statement line items of assets/liabilities that would/would not usually give rise to the difference and the reasons thereon. Any other reasons. b. Illustrate the accounting concepts that deal with the difference in the purchase price and total net assets/equity of the subsidiary acquired in the preparation and presentation of consolidated financial statements. (8 marks)

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The question related to the part that how in actual scenario the acquisition takes place a Financial statement line items of assetsliabilities that wouldwould not usually give rise to the difference a... View the full answer