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Prepare the consolidated balance sheet on the date

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Reference no: EM132479088

Pareto and Sareto had the following balance sheets on December 31, 2017.

                                                       Pareto                    Pareto                   Sareto             Sareto

                                                     (carrying value) (fair value)   (carrying value)       (fair value)

Cash                                          $180,000        $180,000         $36,000                $36,000

Accounts Receivable                      $100,000       $125,000        $40,000                  $33,000

Inventory                                    $ 60,000          $53,000        $48,000                  $55,000

Plant and Equipment (net)              $200,000          $200,000      $50,000                 $72,000

Goodwill                                                          $ -                                            $ 8,000

Trademark                                                         $ -                 $6,000                 $8,000

Total Assets                                                                            $540,000           $188,000

Current Liabilities                            $ 80,000            $80,000         $42,000             $23,000

Bonds Payable                             $320,000              $310,000              $16,000        $20,000

Common Shares                            $ 90,000                                    $80,000

Retained Earnings                         $ 50,000                                     $50,000

Total Liabilities and Equity                 $540,000                                 $188,000

Question 1: Assuming that Pareto acquired 80% of Sareto for $160,000 cash on December 31, 2017, prepare the consolidated balance sheet on the date of acquisition.

Reference no: EM132479088

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