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Spartan Corporation is a successful gold mining company who has operations in the U.S., Canada and South America.They are in the process of expanding their mineral holdings through acquisition of other gold companies. The current acquisition (another U.S. gold company) which Spartan has made an offer on will be financed by the issuance of Spartan’s common stock.Spartan knows that in a non-monetary transaction such as this one, the measurement and valuation of the assets should be based first, on the fair market value of the consideration given (the stock) or second, the fair market value of the consideration received ( the value of the assets) if the stock does not have a value.Since Spartan’s stock sells on the stock exchange, the value of the stock (consideration given up ) should be used to value the cost of the acquisitionHowever, Spartan tells you they would like to value the acquisition at the fair market value of the consideration received (using appraisal values, realizable values, etc) and is willing to hire an outside appraisal firm to prepare the valuation. They believe that gold stocks are traditionally overvalued because the financial markets project future discoveries of gold into the stock value and when Spartan issues the stock for the acquisition, the stock price will drop (more shares in the market will lower the price).Because this acquisition is material to Spartan’s financial statements, they want to review their accounting position with the SEC before implementation.Assuming the SEC does not agree with the Company’s position, answer the following questions:• What arguments might the SEC make for disagreeing with the Company?• What alternatives might the SEC offer which might be an acceptable compromise position for the Company?What do you think is motivating the Company to want to account for the transaction this way and if they cannot, what might be the future accounting implication.There are numerous sources you can use to aid in your research. There are various accounting publications as well as Internet sources noted below:• FASB www.fasb.org ( Check out the new FASB Codification research system)• AICPA www.aicpa.org• Wiley www.wiley.com/college/wallace• RutgersUniversitywww.rutgers.edu: