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On January 1, Park Corporation and Strand Corporation had condensed balance sheets as follows: Park Strand Current assets $ 74,500 $ 16,050 Noncurrent assets 92,250 46,200 Total...

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Accounting

On January 1, Park Corporation and Strand Corporation hadcondensed balance sheets as follows:

ParkStrand
Current assets$74,500$16,050
Noncurrent assets92,25046,200
Total assets$166,750$62,250
Current liabilities$32,000$12,250
Long-term debt51,750
Stockholders' equity83,00050,000
Total liabilities and equities$166,750$62,250

On January 2, Park borrowed $66,000 and used the proceeds toobtain 80 percent of the outstanding common shares of Strand. Theacquisition price was considered proportionate to Strand’s totalfair value. The $66,000 debt is payable in 10 equal annualprincipal payments, plus interest, beginning December 31. Theexcess fair value of the investment over the underlying book valueof the acquired net assets is allocated to inventory (60 percent)and to goodwill (40 percent).

(1) On a consolidated balance sheet as of January 2, what shouldbe the amount for current assets?

(2) On a consolidated balance sheet as of January 2, what shouldbe the amount for non current assets?

Answer & Explanation Solved by verified expert
3.9 Ratings (517 Votes)
On a consolidated Balancesheet each item will be added line by linePark and Strand corporation assets current and non    See Answer
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