Prime Company Acquired 100 Percent of the Voting Common Shares

question 37

Multiple Choice

Prime Company acquired 100 percent of the voting common shares of Standard Video Corporation,its bitter rival,by issuing bonds with a par value and fair value of $150,000.Immediately prior to the acquisition,Prime reported total assets of $500,000,liabilities of $280,000,and stockholders' equity of $220,000.At that date,Standard Video reported total assets of $400,000,liabilities of $250,000,and stockholders' equity of $150,000.Included in Standard's liabilities was an account payable to Prime in the amount of $20,000,which Prime included in its accounts receivable.
-Based on the preceding information,what amount of total assets was reported in the consolidated balance sheet immediately after acquisition?

• A)$650,000
• B)$880,000
• C)$920,000
• D)$750,000

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Definitions:

Worth

The value or importance of something, often in terms of monetary, social, or personal significance.

Nature

The inherent qualities or characteristics of something; can also refer to the physical world and its organisms, landscapes, and processes not made by human beings.

Inherited

Something passed down from previous generations, whether it's traits, possessions, or status.

Conscientiousness

A personality trait characterized by organization, dependability, and a strong sense of duty.