On January 1, 20X1, Pack Corp. acquired all of Slam Corp.’s common stock for $500,000. On that date, the fair values of Slam’s net assets equaled their book values of $400,000. During 20X1, Slam paid cash dividends of $8,000. The following balance sheet and income statement accounts are reported on Pack’s and Slam’s separate financial statements at December 31, 20X1:

Required:

What amount of retained earnings will Pack report in its December 31, 20X1, consolidated balance sheet?

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Pack Slam Balance sheet accounts Investment in Slam $552,000 Retained earnings 780,000 250,000 Income statement accounts Equity in earnings of Slam Net income $ 60,000 150,000 60,000