Purchase of an existing business Flashcards

1
Q

What is the business taken over as?

A

A going concern

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2
Q

The purchase of a business can occur when:

A
  • ST > ST
  • P > ST
  • P > P
  • LTD > ST
  • LTD > P
  • LTD > LTD
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3
Q

Is the value of an ASSET the same for the seller and buyer?

A
  • NO.
  • Purchaser will place his OWN values on the assets
  • Entered in the PURCHASER’S books
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4
Q

What is the difference between the total purchase price and net realisable assets referred to?

A

Goodwill.

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