The Fair Market Value of the Fixed Assets of Markco

question 202

Multiple Choice

The fair market value of the fixed assets of Markco, Inc. is $8,500.
Big-T paid $13,000 for Markco, Inc. with funds from a long-term debt offering. The purchase method of accounting is used.
What is the total amount of debt and equity on the books of Big-T after the merger?

• A) $17,300
• B) $21,800
• C) $25,800
• D) $30,300
• E) $36,800

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Definitions:

Beta Particle

A high-speed electron or positron emitted by certain types of radioactive decay, representing high-energy, high-speed electrons.

Atomic Nucleus

The central core of an atom containing protons and neutrons, and around which electrons orbit.

Radioactive Material

A material containing unstable nuclei that emit radiation as they decay, including alpha particles, beta particles, and gamma rays.

Atomic Nucleus

The dense center of an atom, containing protons and neutrons.