Pagach Company purchased 100% of the voting common stock of Rage Company for $1,800,000. The following book and fair values are available: The bonds payable will appear on the consolidated balance sheet
A)at $300,000 (with no premium or discount shown).
B)at $300,000 less a discount of $50,000.
C)at $0; assets are recorded net of liabilities.
D)at an amount less than $250,000 since it is a bargain purchase.

Question

Pagach Company purchased 100% of the voting common stock of Rage Company for $1,800,000. The following book and fair values are available:  The bonds payable will appear on the consolidated balance sheet
A)at $300,000 (with no premium or discount shown). 
B)at $300,000 less a discount of $50,000. 
C)at $0; assets are recorded net of liabilities. 
D)at an amount less than $250,000 since it is a bargain purchase.

Quizplus · Accepted Answer

The Answer is B

Pagach Company Purchased 100% of the Voting Common Stock of Rage