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On January 2, Pearl borrowed $60,000 and used the proceeds to purchase 90% of the outstanding common shares of Silver.

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On January 2, Pearl borrowed $60,000 and used the proceeds to purchase 90% of the outstanding common shares of Silver. Pearl had no prior equity interest in Silver. Ten equal principal and interest payments begin on December 30. The excess of the implied fair value of Silver Over the carrying amount of its identifiable net assets should be assigned 60% to inventory and 40% to goodwill. Additionally, the fair value of the noncontrolling interest (NCI) is 10% of the implied fair value of the acquire.

The following are the balance sheets of Pearl and Silver on January 1:

Pearl

Silver

Current Assets

70,000

20,000

Non Current Assets

90,000

40,000

   Total Assets

160,000

60,000

Current Liabilities

30,000

10,000

Non Current Liabilities

50,000

0

Equity

80,000

50,000

  Total Liabilities & Equity

160,000

60,000

On Pearl's January 2 consolidated balance sheet,

a) current assets =

 

b) non current assets =

 

c) current liabilities =

 

d) the sum of the non current liabilities and the NCI

 

e) shareholders equity should be

 

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