Kansas City Corporation holds three assets when it comes out of Chapter 11 bankruptcy:   Book Value Fair Value Inventory $86000 $50000 Land and buildings 250000 400000 Equipment 123000 110000 The company has a reorganization value of $600,000.a. Describe the rules to determine whether to apply fresh start accounting to Kansas City.b. If fresh start accounting is appropriate, how will this company’s assets be reported?c. If a Goodwill account is recognized in a reorganization, where should it be reported? What happens to this balance?

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