A parent acquires all of the stock of a subsidiary for $40 million in cash. The subsidiary’s books report the following account balances at the date of acquisition (in trial balance format). Date-of-acquisition fair values are also displayed.

(in millions)	Book value Dr (Cr)	Fair value Dr (Cr)
Current assets	$ 5	$ 6
Noncurrent assets	45	38
Liabilities	(40)	(42)
Capital stock	(8)
Retained earnings	(3)
Accumulated other comprehensive loss	1
Total	$ 0

On the consolidation working paper, eliminating entry (E) debits

a. liabilities by $2 million.

b. accumulated other comprehensive loss by $1 million.

c. investment in subsidiary by $10 million.

d. retained earnings by $3 million.