Under the New Entity Method

Multiple Choice

Under the new entity method,

A) the net assets of the acquiring company remain at book value while those of the acquired company are recorded at fair value.
B) the net assets of the acquiring company are recorded at fair value while those of the acquired company are recorded at book value.
C) the net assets of both companies are recorded at fair market value.
D) the net assets of both companies are recorded at book value.