Question
Parent Inc. and Sub Inc. had the following balance sheets on July 31, 2019: Parent Inc Sub Inc Sub Inc (carrying value) (carrying value) (fair
Parent Inc. and Sub Inc. had the following balance sheets on July 31, 2019: Parent Inc Sub Inc Sub Inc (carrying value) (carrying value) (fair value) Cash $180,000 $36,000 $36,000 Accounts Receivable $100,000 $40,000 $40,000 Inventory $ 60,000 $24,000 $27,000 Plant and Equipment (net) $200,000 $80,000 $93,000 Goodwill $ - $ 8,000 Trademark $ - $12,000 $15,000 Total Assets $540,000 $200,000 Current Liabilities $ 80,000 $50,000 $50,000 Bonds Payable $320,000 $20,000 $24,000 Common Shares $ 90,000 $80,000 Retained Earnings $ 50,000 $50,000 Total Liabilities and Equity $540,000 $200,000
Assuming that Parent Inc acquires 80% of Sub Inc on August 1, 2019 for cash of $180,000, what amount would appear in the Non-Controlling Interest (NCI) Account on the Consolidated Balance Sheet on the date of acquisition if the identifiable net assets (INA) method were used? Multiple Choice $26,000 Nil $45,000 $27,400
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