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12 February, 18:54

The excess of fair value over implied value must be allocated to reduce proportionally the fair values initially assigned to:

a. current assets.

b. noncurrent assets.

c. both current and noncurrent assets.

d. none of the above.

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  1. 12 February, 22:45
    0
    None of the above

    Option d

    Explanation:

    The word excess price over fair market value of total assets relates to the difference that is calculated by a professional assessment between the prices paid for a group of assets and their net values.

    For addition, it is necessary to determine the additional costs above fair market value as one company buys another, with the excess expense on its balance sheet.

    When one corporation receives goods from another business, it must decide whether the price paid for the products was above the fair market value. The process is complicated as one company acquires another because the calculation involves both the purchased companies' assets and liabilities.
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