Velway Corp

Multiple Choice

Velway Corp.acquired Joker Inc.on January 1,2009.The parent paid more than the fair value of the subsidiary's net assets.On that date,Velway had equipment with a book value of $500,000 and a fair value of $640,000.Joker had equipment with a book value of $400,000 and a fair value of $470,000.Joker decided to use push-down accounting.Immediately after the acquisition,what Equipment amount would appear on Joker's separate balance sheet and on Velway's consolidated balance sheet,respectively?

A) $400,000 and $900,000
B) $400,000 and $970,000
C) $470,000 and $900,000
D) $470,000 and $970,000
E) $470,000 and $1,040,000