1.

2.

3.

The following items have been identified for an acquiree company. Which one(s) are separately

capitalized by the acquiring company, per FASB ASC 805?

a. In-process research and development, brands names, developed technology

b. Skilled workforce, potential contracts, future costing savings, favorable press reports

c. Potential contracts, in-process research and development, favorable press reports

d. Developed technology, brand names, favorable location

Blair Company acquires all of the assets and liabilities of Tomlinson Corporation, in a transaction

reported as a merger. How are the assets and liabilities of Blair and Tomlinson reported?

a. Tomlinson's assets and liabilities remain at book value, and Blair's assets and liabilities are

reported at fair value at the date of acquisition

b. The assets and liabilities of both Blair and Tomlinson are reported at fair value at the date of

acquisition

c. Blair's assets and liabilities remain at book value, and Tomlinson's assets and liabilities are

reported at fair value at the date of acquisition

d.

The assets and liabilities of both Blair and Tomlinson are reported at book value at the date of

acquisition

Company Y is purchased by Company X, at an acquisition cost that resulted in a $100,000 of

goodwill. One of the assets acquired is a building, originally valued at $37,000 at the date of

acquisition. Six months after the acquisition, it is discovered that the building was really only

worth $25,000 at the date of acquisition. What entry is made to reflect this new information?

a. A debit of $12,000 to Loss on Impairment

b. A debit of $12,000 to Goodwill

c. A credit of $12,000 to Gain from Bargain Purchase

d. A debit of $100,000 to Goodwill