Growth Corp

Multiple Choice

Growth Corp., a publicly accountable entity, purchased a company with the following assets and liabilities for $100,000: Which of the following is not correct about the difference between carrying value and fair value?

A) Long-term liabilities could have a higher value due lower interest rates.
B) Inventories could have a lower fair value due to obsolescence.
C) Equipment could have a lower fair value due to decreased productive capacity.
D) Inventories could have a lower fair value due to accounting errors.