In order to reduce the risk associated with a new line of business, Conservative Corporation established Spin Company as a wholly owned subsidiary. It transferred assets and accounts payable to Spin in exchange for its common stock. Spin recorded the following entry when the transaction occurred: Cash and receivables23,000 Inventory15,000 Land30,000 Buildings100,000 Equipment95,000 Accounts Payable 20,000Accumulated Depreciation-Buildings 32,000Accumulated Depreciation-Equipment 30,000Common Stock 56,000Additional Paid-In Capital 125,000Based on the preceding information, immediately after the transfer,
A. Conservative's total assets decreased by $20,000.
B. Conservative's total assets decreased by $23,000.
C. Conservative's total assets increased by $56,000.
D. Conservative's total assets remained the same.
Answer: A
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