Need to show work for answers. Parent Company Balance Sheet
Assets, Liabilities & Equities	Book Value
Cash	$250,000
AR	$30,000
Inventory	$150,000
Land	$100,000
Plant and Equipment	$600,000
Less: Accumulated Depreciation	-$150,000
Total Assets	$980,000
AP	$20,000
Common Stock	$100,000
Additional Paid In Capital	$560,000
Retained Earnings	$300,000
Total Liabilities & Equity	$980,000

Sub Company Balance Sheet
Assets, Liabilities & Equities	Book Value	Fair Value
Cash	$40,000	$40,000
AR	$15,000	$10,000
Inventory	$105,000	$200,000
Land	$60,000	$100,000
Plant and Equipment	$400,000	$300,000
Less: Accumulated Depreciation	-$150,000
Goodwill	$10,000
Total Assets	$480,000	$650,000
AP	$50,000	$50,000
Common Stock	$100,000
Additional Paid In Capital	$60,000
Retained Earnings	$270,000
Total Liabilities & Equity	$480,000

Question 6:

What type of business combination would result from Parent Company acquiring Sub Company to form Super-Parent Company?

a)

Statu. Merger

b)

Statu. Consolidation

c)

Stock Acquisition

d) None of the above

Question 7:	Sub Company was a former business activity segment of Parent Company. Parent Company shares were exchanged for Sub Company shares. This can best be described as which of the following?
a)	External Expansion
b)	Internal Expansion
c)	Statu. Merger
d)	None of the above

Question 8:

Sub Company was a former business activity segment of Parent Company. Sub Company shares were issued to Parent Company shareholders. This can best be described as which of the following?

a)

External Expansion

b)

Internal Expansion

c)

Statu. Merger

d) None of the above

Question 9:

Parent Company acquired 10% interest in Sub Company. Which of the following describes the ownership interest of Parent Companyover Sub Company?

a)

Control

b)

Significant Influence

c)

Insignificant Interest

d) None of the above

Question 10:	Parent Company acquired 30% interest in Sub Company. Which of the following describes the ownership interest of Parent Companyover Sub Company?
a)	Control
b)	Significant Influence
c)	Insignificant Interest
d)	None of the above