Question
On January 1, 2016 , Pent Company and Shelter Company had condensed balance sheets as follows: Pent Shelter Current assets $210,00 $60,000 Noncurrent assets 270,000
On January 1, 2016, Pent Company and Shelter Company had condensed balance sheets as follows:
| Pent |
| Shelter |
Current assets | $210,00 |
| $60,000 |
Noncurrent assets | 270,000 |
| 120,000 |
Total assets | $480,000 |
| $180,000 |
|
|
|
|
Current liabilities | $90,000 |
| $30,000 |
Long-term debt | 150,000 |
| -0- |
Stock holders' equity | 240,000 |
| 150,000 |
Total liabilities & stockholders' equity | $480,000 |
| $180,000 |
On January 2, 2016 Pent borrowed $180,000 and used the proceeds to purchase 90% of the outstanding common stock of Shelter. This debt is payable in 10 equal annual principal payments, plus interest, starting December 30, 2016. Any difference between book value and the value implied by the purchase price relates to land.
On Pent's January 2, 2016 consolidated balance sheet, noncurrent assets should be:
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started