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24 March, 06:10

On January 1, 20X9, Pallet Company acquires 80 percent ownership in Slat Corporation for $200,000. The fair value of the noncontrolling interest at that time is determined to be $50,000. Slat reports net assets with a book value of $250,000 and fair value of $250,000. Pallet Company reports net assets with a book value of $600,000 and a fair value of $650,000 at that time, excluding its investment in Slat. What will be the amount of consolidated net assets that would be reported immediately after the combination?

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  1. 24 March, 06:19
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    Consolidated Assets 850,000

    Explanation:

    We need to calcualte the alue of the purchased portion of Slat.

    total assets - non-controlled = proportional owned assets

    250,000 - 50,000 = 200,000

    The consolidated net assets would be:

    Pallet Company 650,000

    Slat Company 250,000

    non-controlling (50,000)

    Consolidated Assets 850,000
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