Plaza Corporation acquires all of the assets and liabilities of Spiceland Company. How are Spiceland’s research...

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Accounting

Plaza Corporation acquires all of the assets and liabilities ofSpiceland Company. How are Spiceland’s research and developmentcosts of ongoing projects reported on Plaza’s books at the date ofacquisition?
              a.     Included as part of goodwill
              b.    Identifiable asset, at fair value
              c.     Operating expense, at fair value
              d.    Loss on acquisition, at Spiceland’s cost

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Solution b Identifiable asset at fair value Note The given answer is justified both in International Financial Reporting standards IFRS and with regard to US generally accepted accounting practices GAAPSee the explanation below Explanation An identifiable asset is anything that has commercial or exchange value and can provide future economic benefits Identifiable assets can be tangible or intangible 1 IPRD Recognition criteria As per US GAAP Financial Accounting Standards Board FASB See Answer

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