1. In addition to an initial issuance of shares, Amos Corp., the acquirer, agrees to issue a certain number of additional shares for each percentage point by which the earnings number exceeds a set amount over the next five years. This is an example of contingent consideration 2. Contingent consideration should be measured at ___fair value_____ at the date of acquisition. 3. The valuation and classification of non-controlling interest under the three consolidation methods (proportionate consolidation method, identifiable net asset (INA) method, fair value enterprise (FVE) method) has ____a big____ impact on the debt-to-equity ratio. 4. After the acquisition date, the fair value of a contingent consideration classified as a liability may change due to changes in circumstances, such as meeting specified sales targets, fluctuations in share price, or subsequent events, such as receiving government approval on an in-process research and development project. Changes in the fair value of a contingent consideration classified as a liability due to changes in circumstances since the acquisition date should be recognized in earnings on the income statement. 5. Peridot Corp. acquires 85% of Amber Foods' outstanding common shares. At the time of acquisition, Amber Foods' common shares and retained earnings are valued at $250,000 and $100,000, respectively. Calculate Peridot's share of the book value of Amber Food's net assets. Reason: Peridot's share of Amber Foods' book value of net assets = 85% × ($250,000 + $100,000) = $297,500. 6. n acquiring a controlling interest, a parent company becomes responsible for managing all the subsidiary's assets and liabilities, even though it may own only a partial interest. Under the fair value enterprise (FVE) method, these assets and liabilities of the subsidiary should be measured at ____ full fair value ____ at the date of acquisition, to enable users to better assess the cash-generating abilities of the identifiable net assets acquired in the business combination and the accountability of management for the resources entrusted to it.