On January 2, 20X8, Photo Corporation acquired 75 percent of Shutter Company's outstanding common stock. In exchange for Shutter's stock, Photo issued bonds payable with a par value of $500,000 and fair value of $510,000 directly to the selling stockholders of Shutter. At that date, the fair value of the noncontrolling interest was $170,000. The two companies continued to operate as separate entities subsequent to the combination. Immediately prior to the combination, the book values and fair values of the companies' assets and liabilities were as follows: Photo Corporation Shutter Company Book Value Fair Value Book Value Fair Value Assets Cash $ 12,000 $ 12,000 $ 9,000 9,000 Receivables 41,000 39,000 31,000 30,000 Allowance for Bad Debts (2,000) (1,000) Inventory 86,000 89,000 68,000 72,000 Land 55,000 200,000 50,000 70,000 Buildings & Equipment 960,000 650,000 670,000 500,000 Accumulated Depreciation (411,000) (220,000) Patent 40,000 Total Assets $ 741,000 $ 990,000 $ 607,000 721,000 Liabilities & Equity Current Payables $ 38,000 $ 38,000 $ 29,000 29,000 Bonds Payable 200,000 210,000 100,000 100,000 Common Stock 300,000 200,000 Additional Paid-in Capital 100,000 130,000 Retained Earnings 103,000 148,000 Total Liabilities & Equity $ 741,000 $ 607,000 At the date of combination, Shutter owed Photo $6,000 plus