Business Combinations

Question 1

What is a business combinations

Answer 1

When one company normally pays for another

Question 2

What are the potential considerations in a business combination?

Answer 2

1) Cash
2) Take on liabilities
3) Issuing shares to them
4) Just a contract

Question 3

What are the potential structures in a business combination?

Answer 3

1) Sub
2) Sub-Subsidiary
3) Net Asset Transfer

Question 4

What is a business?

Answer 4

Something that has inputs, process, and outputs.

Question 5

What are the steps of acquisition method?

Answer 5

1) Identifying the acquirer
2) Determining the acquisition date
3) Recognising ( and measuring) the identifiable assets acquired, the liabilities assumed and any NCI ( Non- controlling assets).
4) Recognising ( and measuring) Goodwill ( or a gain from Bargain Purchase)

Question 6

What is identifying the acquirer?

Answer 6

An entity that has control over the acquiree