Easton Company and Lofton Company were combined in a purchase transaction. Easton was able to acquire Lofton at a bargain price. The sum of the fair values of identifiable assets acquired less the fair value of liabilities assumed exceeded the cost to Easton. Proper accounting treatment by Easton is to report the excess amount as
a. a gain.
b. part of current income in the year of combination.
c. a deferred credit and amortize it.
d. paid-in capital.
Answer: a. a gain.
Business
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A department has budgeted monthly manufacturing overhead cost of $540,000 plus $3 per direct labor hour. If a flexible budget report reflects $1,044,000 for total budgeted manufacturing cost for the month, the actual level of activity achieved during the month was
a) 348,000 direct labor hours. b) cannot be determined from the information provided. c) 528,000 direct labor hours. d) 168,000 direct labor hours.
Business
By default, the identifier of the entity becomes the foreign key of the corresponding table
Indicate whether the statement is true or false
Business