XML 45 R25.htm IDEA: XBRL DOCUMENT v2.4.0.8
Acquisition of Sebree aluminum smelter (Policies)
 6 Months Ended
Jun. 30, 2013
Business Combinations [Abstract]  
Purchase Price Allocation
Purchase Price Allocation
Allocating the purchase price to the acquired assets and liabilities involves management judgment. We allocate the purchase price to the assets acquired, liabilities assumed, and any bargain gain (or goodwill) in accordance with ASC 805, "Business Combinations." Once it has been determined that recognition of an asset or liability in a business combination is appropriate, we measure the asset or liability at fair value in accordance with the principles of ASC 820, "Fair Value Measurements and Disclosures." Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
The determination of the fair value of certain intangible assets and/or liabilities require significant management judgment in each of the following areas:
•
Identify the acquired intangible assets or liabilities. In the case of the Sebree acquisition, we assumed a power contract liability as the contract price is in excess of current market prices.
•
Estimate the fair value of the intangible assets and/or liabilities. We consider various approaches to value the acquired intangible assets and/or liabilities. These valuation approaches include the cost approach, which measures the value of an asset based on the cost to reproduce it or replace it with a like asset; the market approach, which values the assets through an analysis of sales and offerings of comparable assets; and the income approach, which measures the value of an asset (or liability) by measuring the present worth of the economic benefits (or costs) it is expected to produce.