Problem 21 Peter Handy owns all the shares of The Handyman Shop Inc. (Handyman). He is conce that possible liability issues in the company might threaten the equity he has built up in assets, particularly the land and building. A friend told him that he should transfer the business assets and liabilities, other than the building and mortgage, to a new subsidiary corporation, Tool Man Inc., (Tool Man) and use Handyman as a holding company to accumulate assets. Peter would like your advice this proposal or other ideas you might have. Handyman has the following assets and liabilities: Tax Cost Value Cash $22,000 $22,000 Inventory 44,000 39,500 Furniture and fixtures 12,000 6,000 Building 75,000 45,000 Land 8,000 8,000 Goodwill nil nil Accounts payable 25,000 Bank loan 30,000 Mortgage payable 18,000 Before your next meeting with Peter you want to: A. Assess the situation B. Analyze the major issues C. Conclude and advise