Question
IS) On January 1, Current assets Noncurrent assets Total assets Current liabilities L one-term debt 2016, Pell Company and Sand Company had condensed balance
IS) On January 1, Current assets Noncurrent assets Total assets Current liabilities L one-term debt 2016, Pell Company and Sand Company had condensed balance sheets as follows: Stockholders' equity Total liabilities & stockholders' equity Pell s 280,000 360,000 ooo s 120,000 200,000 320,000 Sand 580,000 160,000 $240,000 540,000 200,000 5240.000 On January 2, 2016 Pell borrowed 5240,000 and used the proceeds to purchase 900/0 of the outstanding common stock of Sand. This debt is payable in 10 equal annual principal pal..-ments, plus interest, starting December 30, 2016. Any difference between book value and the implied by the purchase price relates to land. On Pell's January 2, 2016 ron01idRted balance sheet, noncurrent liabilities should be: a) S440,ooo_ b) S416,ooo_ c) suo,ooo_ d) S216,ooo_ Answer: b
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