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    Pooling of interests vs Purchase: Recording of Equipment

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    How would equipment obtained a business combination have been recorded under each of the following methods:
    Pooling of Interests Purchase

    a) Recorded value Recorded value
    b) Recorded value Fair Value
    c) Fair Value Fair Value
    d) Fair Value Recorded value

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    Pooling of interests accounting assumes that, upon purchase, the merged companies are one entity; therefore, ...

    Solution Summary

    This solution discusses how the cost of acquired equipment is recorded using the pooling of interests method and the purchase method of accounting.