Watkins, Inc. acquires all of the outstanding stock of Glen Corporation on January 1, 2012. At that date, Glen owns only three assets and has no liabilities: If Watkins pays $450,000 in cash for Glen, at what amount would Glen's Inventory acquired be represented in a December 31, 2012 consolidated balance sheet?
A) $40,000.
B) $50,000.
C) $0.
D) $10,000.
E) $90,000.

Question

Watkins, Inc. acquires all of the outstanding stock of Glen Corporation on January 1, 2012. At that date, Glen owns only three assets and has no liabilities:  If Watkins pays $450,000 in cash for Glen, at what amount would Glen's Inventory acquired be represented in a December 31, 2012 consolidated balance sheet?
A) $40,000. 
B) $50,000. 
C) $0. 
D) $10,000. 
E) $90,000.

Quizplus · Accepted Answer

Zero (Under FIFO all Inventory would go to COGS)