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 $ 80,000 $ 42,000 Accounts receivable (net) 140,000 28,000 Inventories 86,000 60,000 Plant and equipment (net) 640,000 278,000 Investment in Sean 454,000 - Total assets $ 1,400,000 $ 408,000 Accounts payable 172,000 86,000 Long-term debt 100,000 26,000 Common stock ($10 par) 306,000 70,000 Additional paid-in capital 14,000 Retained earnings 822,000 212,000 Total liabilities and shareholders' equity $ 1,400,000 $ 408,000 Additional Information: On December 31, 2020, Patrick acquired 100 percent of Sean’s voting stock in exchange for $454,000. At the acquisition date, the fair values of Sean’s assets and liabilities equaled their carrying amounts, respectively, except that the fair value of certain items in Sean’s inventory were $26,000 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? $1,380,000 $1,400,000 $1,512,000 $1,966,000
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 $ 80,000 $ 42,000 Accounts receivable (net) 140,000 28,000 Inventories 86,000 60,000 Plant and equipment (net) 640,000 278,000 Investment in Sean 454,000 - Total assets $ 1,400,000 $ 408,000 Accounts payable 172,000 86,000 Long-term debt 100,000 26,000 Common stock ($10 par) 306,000 70,000 Additional paid-in capital 14,000 Retained earnings 822,000 212,000 Total liabilities and shareholders' equity $ 1,400,000 $ 408,000 Additional Information: On December 31, 2020, Patrick acquired 100 percent of Sean’s voting stock in exchange for $454,000. At the acquisition date, the fair values of Sean’s assets and liabilities equaled their carrying amounts, respectively, except that the fair value of certain items in Sean’s inventory were $26,000 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? $1,380,000 $1,400,000 $1,512,000 $1,966,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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 | $ | 80,000 | $ | 42,000 |
| 140,000 | 28,000 | |||
| Inventories | 86,000 | 60,000 | ||
| Plant and equipment (net) | 640,000 | 278,000 | ||
| Investment in Sean | 454,000 | - | ||
| Total assets | $ | 1,400,000 | $ | 408,000 |
| Accounts payable | 172,000 | 86,000 | ||
| Long-term debt | 100,000 | 26,000 | ||
| Common stock ($10 par) | 306,000 | 70,000 | ||
| Additional paid-in capital | 14,000 | |||
| 822,000 | 212,000 | |||
| Total liabilities and shareholders' equity | $ | 1,400,000 | $ | 408,000 |
Additional Information:
- On December 31, 2020, Patrick acquired 100 percent of Sean’s voting stock in exchange for $454,000.
- At the acquisition date, the fair values of Sean’s assets and liabilities equaled their carrying amounts, respectively, except that the fair value of certain items in Sean’s inventory were $26,000 more than their carrying amounts.
In the December 31, 2020, consolidated
-
$1,380,000
-
$1,400,000
-
$1,512,000
-
$1,966,000
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