$180,000. At that date, Skate reported net assets of $150,000. The fair value of the noncontrolling interest was $45,000. Assume Pond uses the fully adjusted equity method. The balance sheets for Pond and Skate at January 1, 20X8, and December 31, 20X8, and income statements for 20X8 were reported as follows: 20X8 Balance Sheet Data Cash Accounts Receivable Interest & Other Receivables Inventory Land Buildings & Equipment Accumulated Depreciation Investment in Skate Co. Investment in Tin Co. Bonds Total Assets Accounts Payable Interest & Other Payables Bonds Payable Bond Discount Common Stock Additional Paid-in Capital Retained Earnings Total Liabilities and Equities Pond Corporation January 1 $ 40,400 120,000 40,000 December 31 $ 68,400 130,000 Skate Company January 1 $ 10,000 December 31 $ 47,000 60,000 65,000 45,000 8,000 10,000 100,000 140,000 50,000 50,000 50,000 50,000 22,000 22,000 400,000 400,000 240,000 240,000 (185,000) (70,000) (94,000) (150,000) 185,600 135,000 $ 921,000 200,100 134,000 $ 982,500 $ 65,000 $320,000 $ 60,000 40,000 300,000 45,000 300,000 $ 16,500 7,000 100,000 $340,000 $ 11,000 12,000 100,000 (3,500) (3,000) 150,000 150,000 30,000 30,000 155,000 155,000 20,000 20,000 216,000 267,500 150,000 170,000 $ 921,000 $ 982,500 $320,000 $340,000 Sales Income from Skate Co. Interest Income Total Revenue Cost of Goods Sold Other Operating Expenses Depreciation Expense Interest Expense Miscellaneous Expenses Net Income 20X8 Income Statement Data Pond Corporation $ 450,000 22,500 14,900 487,400 Skate Company $ 250,000 $ 250,000 $285,000 $136,000 50,000 40,000 35,000 24,000 24,000 11,900 (405,900) 10,500 9,500 (220,000) $ 81,500 $ 30,000 Additional Information 1. In 20X2, Skate developed a patent for a high-speed drill bit that Pond planned to market extensively. In accordance with generally accepted accounting standards, Skate charges all research and development costs to expense in the year the expenses are incurred. At January 1, 20X5, the market value of the patent rights was estimated to be $50,000. Pond believes the patent will be of value for the next 20 years. The remainder of the differential is assigned to buildings and equipment, which also had a 20-year estimated economic life at January 1, 20X5. All of Skate's other assets and liabilities identified by Pond at the date of acquisition had book values and fair values that were relatively equal. 2. On December 31, 20X7, Pond sold a building to Skate for $65,000 that it had purchased for $125,000 and depreciated on a straight-line basis over 25 years. At the time of sale, Pond reported accumulated depreciation of $75,000 and a remaining life of 10 years. 3. On July 1, 20X6, Skate sold land that it had purchased for $22,000 to Pond for $35,000. Pond is planning to build a new warehouse on the property prior to the end of 20X9. 4. Both Pond and Skate paid dividends in 20X8.