Question: if fair value lower than book value, how to prepare a acquisition analysis? for example,A acquire all share capital of B, tax rate is 30%,

if fair value lower than book value, how to prepare a acquisition analysis?

for example,A acquire all share capital of B, tax rate is 30%, book value of account receivable is $16,000 but fair value is $12,700, brand's book value is $10,000 but fair value is $24,000. Equity of B Ltd consisted of:

share capital = $350,000

General reserve = $100,000

Retained earning = $60,000

how to prepare a acquisition analysis? Is that $350,000+$100,000+60,000-$3,300*(1-30%)-$24,000=$483,690?

please answer with calculation.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

if fair value lower than book value, how to prepare an acquisition analysis? for example,A acquire all share share capital of B, tax rate is 30%, book value of account receivable is $16,000 but fair...

CS1 ACC702 questions attached below Question 1: Intangible Amt [ 3 Marks] Brilliant Ltd acquires copyrights to the original recordings of a famous singer. The agreement with the singer allows the...

What is the present value of the term loan? What would the present value be if Reader's Digest had chosen permanent debt instead of a term loan? What is the impact on common shareholders of the...

a. Assuming Cest directly acquires the shares of Parfum, construct the projected consolidated statement of financial position, the projected consolidated statement of profit or loss, and the...

hello, can someone give me a detailed solution to part a. im abit confused with the brand with a fair value of 50,000. thank you. 0n 1 July 2013 Tony Ltd acquired all of the share capital (cum divlof...

On 1 July 2021, Tom Ltd acquired all the shares of Hanks Ltd on an ex-div . basis. Tom Ltd paid $850,000 cash and issued 120,000 shares which had a fair value of $5.00 on acquisition date. On this...

Case study: (50 marks) -PART A On 1 July 2021, Tom Ltd acquired all the shares of Hanks Ltd on an ex-div . basis. Tom Ltd paid $850,000 cash and issued 120,000 shares which had a fair value of $5.00...

On 1 July 2020, Big Ltd acquired all the shares of Ben Ltd on an ex-div. basis. Big Ltd paid $700,000 cash and issued 20,000 shares which had a fair value of $30.00 on acquisition date. On this date,...

Pico Ltd acquired 75% of the issued shares of Sigla Ltd on 1 July 2015. In exchange for these shares, Pico Ltd gave a consideration of $26 000 cash and 10 000 shares in Pico Ltd, which had a fair...

Find the future value of an investment of $8,000 compounded quarterly for seven years at 2%?

The expected cost of Betazine therapy is $544. It is effective 57% of the time, with a 6% chance of an adverse drug reaction. The following table shows data for Alphazine, a new treatment. Estimate...

9.26 Consider the data in Exercise 9.13. Suppose the manufacturer of the shearing pins insists that the Rockwell hardness of the product be less than or equal to 44.0 only 5% of the time. What is...

2. A YES-NO voting system is defined as follows: A committee consists of 12 voting members, a resolution requires 8 votes to pass, but there are 3 committee members who have the power to veto. Is...

5. The next time a negative event occurs, or a negative memory occurs, think about how you need to perform to make this a success story.

1. To understand the impression you want the other or the others to have of yourself.

4. Imagine an everyday task that you find difficult or troublesome to perform. Think through the entire sequence of activities with this everyday task. How do you go about making this a success? How...