MacHeath Inc.bought 60% of the outstanding common stock of Nomes Inc.in an acquisition that resulted in the recognition of goodwill.Nomes owned a piece of land that cost $250,000 but was worth $600,000 at the date of acquisition.What value would be attributed to this land in a consolidated balance sheet at the date of acquisition?
A) $250,000.
B) $150,000.
C) $600,000.
D) $360,000.
E) $460,000.

Question

Quizplus · Accepted Answer

In a consolidated balance sheet, assets are recorded at their fair value at the date of acquisition. Therefore, the land would be valued at its fair value of $600,000.