Question

How can acquisition date clasify an item as debt or equity?

Answer 1

Hiii mate

Good morning

Here's ur answer

In an acquisition, one company purchases another business.

The balance sheet of the company shows assets and liabilities of the company. Assets minus liabilities is equal to the net worth or owner's equity.

When business is first acquired the impact is on the balance sheet and not the income statement. The price of acquisition is added to the assets of the business.

Hope it helps uh

Thnq

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