Which of the following must be disclosed regarding asset transfers under financial accounting standards?

• A. The names of all employees involved in the transfer
• B. The method used to value the transferred assets
• C. The nature and amount of each asset transferred
• D. The market share of the company after the transfer

Answer: (C)

Verified step by step guidance

1. Understand the context of asset transfers: Asset transfers involve the movement of assets from one entity to another, and financial accounting standards require specific disclosures to ensure transparency and compliance.
2. Identify the required disclosures: Financial accounting standards typically mandate the disclosure of the method used to value the transferred assets and the nature and amount of each asset transferred. These disclosures provide clarity on how the assets were valued and the specifics of the assets involved.
3. Exclude irrelevant information: The names of employees involved in the transfer and the market share of the company after the transfer are not required disclosures under financial accounting standards. Focus only on the mandated disclosures.
4. Explain the valuation method: The method used to value the transferred assets must be disclosed to ensure stakeholders understand the basis for the asset valuation, such as fair value, historical cost, or another valuation method.
5. Detail the nature and amount of assets: The nature (type or category) and amount (quantity or monetary value) of each asset transferred must be disclosed to provide a clear picture of the transaction's impact on the financial statements.