Reference no: EM132782847

Apex Company acquired 80% of the outstanding stock of Nadir Company. The separate balance sheet of Apex immediately after the acquisition and the consolidated balance sheet are as follows:

                                                                 Apex                        Consolidated

Current assets                                $106,000              $146,000

Investment in Nadir (cost)                    100,000                 -0-

Property, plant, & equipment                  270,000              363,000

Goodwill                                                  -0-                5,000

Total assets                                             $476,000           $514,000

Current liabilities                                          $ 15,000          $ 28,000

Noncontrolling interest                                  -0-                     25,000

Common stock                                               350,000               350,000

Retained earnings                                           111,000              111,000

Total liabilities & stockholders' equity                    $476,000               $514,000

Problem 1: Current assets of Nadir included a $2,000 receivable from Apex which arose before they became related on an ownership basis. Accordingly, what was the total of the current assets on Nadir's separate balance sheet at the time Apex acquired its 80% interest?

a.$44,000

b.$42,000

c.$40,000

d.$38,000