3. On January 1, 2015, Ramon Corporation acquired 75 percent of Tester Company's voting common stock for $300,000. At the time of the combination, Tester reported common stock outstanding of $200,000 and retained earnings of $150,000, and the fair value of the noncontrolling interest was $100,000. The book value of Tester's net assets approximated market value except for patents that had a market value of $50,000 more than their book value. The patents had a remaining economic life of five years at the date of the business combination. Tester reported net income of $40,000 and paid dividends of $10,000 during 2015.

1. Based on the preceding information, what balance will Ramon report as its investment in Tester at December 31, 2015, assuming Ramon uses the equity method in accounting for its investment?

2. Based on the preceding information, what are the eliminating entry needed to prepare the consolidated financial statements at December 31, 2015?