Gain on bargain purchase is recognized when

Question

Select one:
O a. the cost of acquisition (investment cost of the
acquirer) and non-controlling interest in the acquire exceed the fair value of the identifiable assets and liabilities acquired
O b. the cost of acquisition (investment cost of the
acquirer) and non-controlling interest in the acquiree is less than the fair value of the identifiable assets and liabilities acquired
O c. the cost of acquisition (investment cost of the acquirer) and noh controlling interest in the acquiree is equal to the fair value of the identifiable assets and liabilities acquired
• d. the cost of acquisition (investment cost of the acquirer) and non-controlling interest in the acquiree is paid for by cash

Answer 1

The correct answer is b. the cost of acquisition (investment cost of the acquirer) and non-controlling interest in the acquiree is less than the fair value of the identifiable assets and liabilities acquired.