On January 1, Year 1, Polk Corp. and Strass Corp. had condensed balance sheets as follows:

	Polk	Strass
Current assets	$70,000	$20,000
Noncurrent assets	90,000	40,000
Total assets	$160,000	$60,000
Current liabilities	$30,000	$10,000
Long-term debt	50,000	-
Stockholders' equity	80,000	50,000
Total liabilities and stockholders' equity	$160,000	$60,000

On January 2, Year 1, Polk borrowed $60,000 and used the proceeds to purchase 90% of the outstanding common shares of Strass. This debt is payable in ten equal annual principal payments, plus interest, beginning December 30, Year 1. The excess cost of the investment over Strass' book value of acquired net assets should be allocated 60% to inventory and 40% to goodwill. On January 2, Year 1, the fair value of Strass shares held by noncontrolling parties was $10,000. On Polk's January 2, Year 1, consolidated balance sheet, current liabilities should be

A.

$30,000

B.

$40,000

C.

$46,000

D.

$50,000