The separate condensed balance sheets of Patrick Corporation and its wholly-owned subsidiary, Sean Corporation, are...
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Accounting
The separate condensed balance sheets of Patrick Corporation and its wholly-owned subsidiary, Sean Corporation, are as follows:
BALANCE SHEETS
December 31, 2020
Patrick
Sean
Cash
$
78,000
$
66,000
Accounts receivable (net)
130,000
38,000
Inventories
88,000
72,000
Plant and equipment (net)
632,000
276,000
Investment in Sean
464,000
-
Total assets
$
1,392,000
$
452,000
Accounts payable
152,000
94,000
Long-term debt
116,000
32,000
Common stock ($10 par)
320,000
54,000
Additional paid-in capital
8,000
Retained earnings
804,000
264,000
Total liabilities and shareholders' equity
$
1,392,000
$
452,000
Additional Information:
On December 31, 2020, Patrick acquired 100 percent of Seans voting stock in exchange for $464,000.
At the acquisition date, the fair values of Seans assets and liabilities equaled their carrying amounts, respectively, except that the fair value of certain items in Seans inventory were $24,000 more than their carrying amounts.
In the December 31, 2020, consolidated balance sheet of Patrick and its subsidiary, what amount of total assets should be reported?
Multiple Choice
$1,518,000
$1,982,000
$1,392,000
$1,372,000
Answer & Explanation
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