Skip to main content\ Skip Chapter 3 Homework Navigation\ eBook\ Question 1Not changed since last attemptMarked out of 10.00 Not flaggedFlag question\ Question text\ PR Company pays $10,000 in cash and issues stock with a fair value of $40,000 to acquire all of SX Corporations stock. SX will be a subsidiary of PR. Balance sheet accounts just prior to the acquisition are as follows, in trial balance format:\ \ \ \ PR Company SX Corporation\ Book value Book value Fair value\ Dr (Cr) Dr (Cr) Dr (Cr)\ Current assets $14,000 $ 2,000 $ 4,200\ Property, plant & equipment, net 110,000 10,000 6,000\ Identifiable intangible assets 800 4,000 14,000\ Current liabilities (13,000) (1,600) (2,000)\ Long-term debt (60,000) (12,000) (11,600)\ Capital stock (44,400) (5,000) \ Retained earnings (8,000) (8,000) \ Accumulated other comprehensive income (200) 1,000 \ Treasury stock 800 9,600 \ Total $ 0 $ 0 \ \ \ PRs consultants find these items that are not reported on SXs balance sheet:\ \ \ \ Fair value\ Potential contracts with new customers $ 6,000\ Advanced production technology 4,000\ Future cost savings 2,000\ Customer lists 1,000\ \ \ Outside consultants are paid $200 in cash, and registration fees to issue PRs new stock are $400, paid in cash. Total acquisition cost reported by PR (the debit to Investment on PRs books) is\ \ $50,000\ $50,200\ $50,400\ $50,600