Wood Company and Willie Inc. form a joint venture—Woodly Partners—to manufacture and distribute agricultural pesticides. Wood and Willie each contribute \($20\) million cash and receive 50% of Woodly’s common stock. Woodly then borrows \($200\) million from a consortium of banks and uses the money to build its manufacturing and distribution facilities. The loan is made on December 31, 2008 and is fully guaranteed by both Wood and Willie.
Required:
How much of the \($200\) million debt shows up on the December 31, 2008 balance sheet of Wood Company? Why?