# Calculating Net Amount of Fair Values of Identifiable Assets Less Liabilities ## Step 1: Add Fair Values of Identifiable Assets **Action:** Sum the fair values of all identifiable assets acquired in a transaction (e.g., cash, inventory, property, equipment, intangible assets). **Explanation:** This step determines the total economic value of all assets that can be specifically identified and measured at fair value. --- ## Step 2: Subtract Liabilities **Action:** Subtract the fair value of all identifiable liabilities assumed (e.g., accounts payable, loans, accrued expenses) from the total assets calculated in Step 1. **Explanation:** Deducting the liabilities accounts for obligations that reduce the net value acquired. This provides the net identifiable assets. --- ## Final Answer **Net Amount = Fair Value of Identifiable Assets – Fair Value of Identifiable Liabilities** This net amount represents the value of identifiable net assets acquired in a transaction, commonly used in business combinations and goodwill calculations.