alleryStart learning →P pays Rs 300 lakh cash plus an earn-out valued at Rs 40 lakh on the acquisition date. Total consideration?
ARs 260 lakh
BRs 300 lakh
CRs 340 lakh
DRs 400 lakh
Answer & Solution
Correct answer: C. Rs 340 lakh
Contingent consideration is included at acquisition-date fair value, so 300 plus 40 equals Rs 340 lakh.
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