For each of the following situations, select the best letter answer to reflect the effect of the numbered item on the acquirer's accounting entry at the date of combination when separate incorporation will be maintained. Item (4) requires two selections.(A) Increase Investment account.(B) Decrease Investment account.(C) Increase Liabilities.(D) Increase Common stock.(E) Decrease common stock.(F) Increase Additional paid-in capital.(G) Decrease Additional paid-in capital.(H) Increase Retained earnings(I) Decrease Retained earnings________ 1. Direct costs.________ 2. Indirect costs.________ 3. Stock issue costs.________ 4. Contingent consideration.________ 5. Bargain purchase.
What will be an ideal response?
(1) I; (2) I; (3) G; (4) A, C; (5) H
Business
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