Adams, Inc., acquires Clay Corporation on January 1, 2020, in exchange for $555,500 cash. Immediately after the acquisition, the two companies have the following account balances. Clay's equipment (with a five-year remaining life) is actually worth $487,300. Credit balances are indicated by parentheses. d Current assets Investment in Clay Equipment Liabilities Common stock Retained earnings, 1/1/20 Adams Clay $ 422,000 555,500 $ 285,000 0 727,300 430,000 (286,000) (221,000) (350,000) (1,068,800) (150,000) (344,000) In 2020, Clay earns a net income of $69,300 and declares and pays a $5,000 cash dividend. In 2020, Adams reports net income from its own operations (exclusive of any income from Clay) of $175,000 and declares no dividends. At the end of 2021, selected account balances for the two companies are as follows: Revenues Expenses Investment income Retained earnings, 1/1/21 Dividends declared Common stock Current assets Investment in Clay Equipment Liabilities $ Adams (510,000) 369,750 Not given Clay $ (268,000) 201,000 0 Not given (408,300) 0 (350,000) 798,000 8,000 (150,000) 331,800 Not given 0 641,800 (218,800) 488,800 (186,800)