(a) Foghorn Ltd acquired all the share capital of Prissy Ltd on 1 Jan 20X7. At that time, the fair values of Prissy Ltd's net assets were as follows:

\fItem Accounts receivable Vehicle Equipment Accounts payable Cost $ 50 000 120 000 80 000 (60 000) Carrying amount $ 50 000 80 000 65 000 (60 000) Fair value $ 40 000 90 000 60 000 (60 000)