A U.S. parent acquired all of the stock of its British subsidiary at the beginning of 2016, when the exchange

rate was $1.50/. The acquisition price exceeded the subsidiarys book value, and this excess was attributed

to intangibles with a life of 5 years, valued at 400,000, and goodwill. The subsidiarys functional currency

is the pound. In 2021, the subsidiary reports net income of 500,000 and pays no dividends. Goodwill im

pairment is 20,000. The beginning and ending exchange rates for 2021 are $1.60 and $1.70, respectively,

and the average rate for 2021 is $1.65. The U.S. parent uses the complete equity method to account for its

investment on its own books. The U.S. parents 2021 equity in net income of subsidiary is

a. $660,000.

b. $720,000.

c. $792,000.

d. $825,000