A parent company acquired 100 percent of the stock of a subsidiary company on January 1, 2015, for $480,000. On this date, the balances of the subsidiary's stockholder's equity accounts were Common Stock, $291,200 and Retained Earnings $31,360 On January 1, 2015, the subsidiary's recorded book values were equal to fair values for all items except four; (1) accounts receivable had a book value of $89,600 and a fair value of $80,640, (2) buildings and equipment, net had a book value of $78,400 and a fair value of $118,720, (3) the Customer List intangible asset had a book value of $22,400 and a fair value of $116,480, and (4) notes payable had a book value of $48,000 and a fair value of $44,800. Both companies use the FIFO inventory method and sell all of their inventories at lease once per year. The net balance of accounts receivable are collected in the following year. On the acquisition date, the subsidiary's buildings and equipment, net had a remaining useful life of 6 years, the Customer List had a remaining useful life of 7 years, and notes payable had a remaining term of 4 years. On January 15, 2018, the parent sold a building to the subsidiary for $145,600. On this date, the building was carried on the subsidiary's books (net of accumulated depreciation) at $112,000 Both companies estimated that the building has a remaining life of 6 years on the intercompany sale date, with no salvage value. Each company routinely sells merchandise to the other company, with a profit margin of 25 percent of the selling price (regardless of the direction of the sale). During 2019, intercompany sales amount to $33,600, of which $17,920 of merchandise remains in the ending inventory of the parent. On December 31, 2019, $8,960 of these intercompany sales remained unpaid. Additionally, the subsidiary's December 31, 2018 inventory includes $26,880 of merchandise purchased in the preceding year from the parent. During 2018, intercompany sales amount to $44,000 and on December 31, 2018 $6,400 of these intercompany sales remained unpaid. Following are pre-consolidation financial statements of the parent and its subsidiary for the year ended December 31, 2019. The parent uses the equity method of pre-consolidation investment bookkeeping. A parent company acquired 100 percent of the stock of a subsidiary company on January 1, 2015, for $480,000. On this date, the balances of the subsidiary's stockholder's equity accounts were Common Stock, $291,200 and Retained Earnings $31,360 On January 1, 2015, the subsidiary's recorded book values were equal to fair values for all items except four; (1) accounts receivable had a book value of $89,600 and a fair value of $80,640, (2) buildings and equipment, net had a book value of $78,400 and a fair value of $118,720, (3) the Customer List intangible asset had a book value of $22,400 and a fair value of $116,480, and (4) notes payable had a book value of $48,000 and a fair value of $44,800. Both companies use the FIFO inventory method and sell all of their inventories at lease once per year. The net balance of accounts receivable are collected in the following year. On the acquisition date, the subsidiary's buildings and equipment, net had a remaining useful life of 6 years, the Customer List had a remaining useful life of 7 years, and notes payable had a remaining term of 4 years. On January 15, 2018, the parent sold a building to the subsidiary for $145,600. On this date, the building was carried on the subsidiary's books (net of accumulated depreciation) at $112,000 Both companies estimated that the building has a remaining life of 6 years on the intercompany sale date, with no salvage value. Each company routinely sells merchandise to the other company, with a profit margin of 25 percent of the selling price (regardless of the direction of the sale). During 2019, intercompany sales amount to $33,600, of which $17,920 of merchandise remains in the ending inventory of the parent. On December 31, 2019, $8,960 of these intercompany sales remained unpaid. Additionally, the subsidiary's December 31, 2018 inventory includes $26,880 of merchandise purchased in the preceding year from the parent. During 2018, intercompany sales amount to $44,000 and on December 31, 2018 $6,400 of these intercompany sales remained unpaid. Following are pre-consolidation financial statements of the parent and its subsidiary for the year ended December 31, 2019. The parent uses the equity method of pre-consolidation investment bookkeeping. A parent company acquired 100 percent of the stock of a subsidiary company on January 1, 2015, for $480,000. On this date, the balances of the subsidiary's stockholder's equity accounts were Common Stock, $291,200 and Retained Earnings $31,360 On January 1, 2015, the subsidiary's recorded book values were equal to fair values for all items except four; (1) accounts receivable had a book value of $89,600 and a fair value of $80,640, (2) buildings and equipment, net had a book value of $78,400 and a fair value of $118,720, (3) the Customer List intangible asset had a book value of $22,400 and a fair value of $116,480, and (4) notes payable had a book value of $48,000 and a fair value of $44,800. Both companies use the FIFO inventory method and sell all of their inventories at lease once per year. The net balance of accounts receivable are collected in the following year. On the acquisition date, the subsidiary's buildings and equipment, net had a remaining useful life of 6 years, the Customer List had a remaining useful life of 7 years, and notes payable had a remaining term of 4 years. On January 15, 2018, the parent sold a building to the subsidiary for $145,600. On this date, the building was carried on the subsidiary's books (net of accumulated depreciation) at $112,000 Both companies estimated that the building has a remaining life of 6 years on the intercompany sale date, with no salvage value. Each company routinely sells merchandise to the other company, with a profit margin of 25 percent of the selling price (regardless of the direction of the sale). During 2019, intercompany sales amount to $33,600, of which $17,920 of merchandise remains in the ending inventory of the parent. On December 31, 2019, $8,960 of these intercompany sales remained unpaid. Additionally, the subsidiary's December 31, 2018 inventory includes $26,880 of merchandise purchased in the preceding year from the parent. During 2018, intercompany sales amount to $44,000 and on December 31, 2018 $6,400 of these intercompany sales remained unpaid. Following are pre-consolidation financial statements of the parent and its subsidiary for the year ended December 31, 2019. The parent uses the equity method of pre-consolidation investment bookkeeping. A parent company acquired 100 percent of the stock of a subsidiary company on January 1, 2015, for $480,000. On this date, the balances of the subsidiary's stockholder's equity accounts were Common Stock, $291,200 and Retained Earnings $31,360 On January 1, 2015, the subsidiary's recorded book values were equal to fair values for all items except four; (1) accounts receivable had a book value of $89,600 and a fair value of $80,640, (2) buildings and equipment, net had a book value of $78,400 and a fair value of $118,720, (3) the Customer List intangible asset had a book value of $22,400 and a fair value of $116,480, and (4) notes payable had a book value of $48,000 and a fair value of $44,800. Both companies use the FIFO inventory method and sell all of their inventories at lease once per year. The net balance of accounts receivable are collected in the following year. On the acquisition date, the subsidiary's buildings and equipment, net had a remaining useful life of 6 years, the Customer List had a remaining useful life of 7 years, and notes payable had a remaining term of 4 years. On January 15, 2018, the parent sold a building to the subsidiary for $145,600. On this date, the building was carried on the subsidiary's books (net of accumulated depreciation) at $112,000 Both companies estimated that the building has a remaining life of 6 years on the intercompany sale date, with no salvage value. Each company routinely sells merchandise to the other company, with a profit margin of 25 percent of the selling price (regardless of the direction of the sale). During 2019, intercompany sales amount to $33,600, of which $17,920 of merchandise remains in the ending inventory of the parent. On December 31, 2019, $8,960 of these intercompany sales remained unpaid. Additionally, the subsidiary's December 31, 2018 inventory includes $26,880 of merchandise purchased in the preceding year from the parent. During 2018, intercompany sales amount to $44,000 and on December 31, 2018 $6,400 of these intercompany sales remained unpaid. Following are pre-consolidation financial statements of the parent and its subsidiary for the year ended December 31, 2019. The parent uses the equity method of pre-consolidation investment bookkeeping