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Pascal Corporation purchased 90% of the stock of Salzer Company for $2,070,000 on January 1, 2005.

Pascal Corporation purchased 90% of the stock of Salzer Company for $2,070,000 on January 1, 2005. On this date, the fair value of the assets and liabilities of Salzer Company was equal to their book value except for the inventory and equipment accounts. The inventory had a fair value of $725,000 and a book value of $600,000. The equipment had a book value of $900,000 and a fair value of $1,075,000.

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