On January 1, 2016, Pent Company and Shelter Company Had

question 9

Multiple Choice

On January 1, 2016, Pent Company and Shelter Company had condensed balance sheets as follows: On January 2, 2016 Pent borrowed $180,000 and used the proceeds to purchase 90% of the outstanding common stock of Shelter. This debt is payable in 10 equal annual principal payments, plus interest, starting December 30, 2016. Any difference between book value and the value implied by the purchase price relates to land. On Pent's January 2, 2016 consolidated balance sheet, current liabilities should be:

• A) $150,000.
• B) $138,000.
• C) $120,000.
• D) $90,000.

---

Definitions:

Capillary Action

The ability of a liquid to flow in narrow spaces without the assistance of or even against external forces like gravity.

Hydrogen Bond

A weak attractive force existing between a hydrogen atom with a partial positive charge and an electronegative atom (usually oxygen or nitrogen) with a partial negative charge. Compare with covalent bond and ionic bond.

Van der Waals Interaction

A type of weak interaction between molecules due to transient electric dipole moments, influencing molecular structure and function.

Ionic Bond

A type of chemical bond formed through the electrical force between oppositely charged ions.