Reference no: EM131756782
Question: Can you exlpain this questions?
On January 1, 20 X 6, Polka Co. (Polka) and Strauss Co. (Strauss) had condensed balance sheets as follows:
|
Polka
|
Strauss
|
|
Current assets
|
$70,000
|
$20,000
|
|
Noncurrent assets
|
$90,000
|
$40,000
|
|
Current liabilities
|
$30,000
|
$10,000
|
|
Long-term debt
|
$50,000
|
$0
|
|
Stockholders' equity
|
$80,000
|
$50,000
|
On January 2, 20X6, Polka borrowed $90,000 and used the proceeds to acquire 90% of the outstanding common shares of Strauss. This debt is payable in ten equal annual principal and accrued interest payments beginning December 30, 20X6. On the acquisition date, the fair value of Strauss was $100,000, and the excess cost of the investment over Strauss's carrying amount of acquired net assets should be allocated 60% to inventory and 40% to goodwill.
1. Current assets on the January 2, 20 X 6, consolidated balance sheet should be.
2. Noncurrent assets on the January 2, 20 X 6, consolidated balance sheet should be.
3. Current liabilities on the January 2, 20 X 6, consolidated balance sheet should be.
4. Noncurrent liabilities on the January 2, 20 X 6, consolidated balance sheet should be.