Assume that, on January 1, 2019, P Company acquired an 70% interest in its subsidiary, S Company. The aggregate fair value of the controlling and noncontrolling interest was $400,000 in excess of S Companys Stockholders Equity on the acquisition date. At the time of acquisition, S Companys retained earnings balance was $415,000. The parent uses the cost method to account for its investment in S company. The parent assigned the acquisition accounting premium (AAP) as follows: AAP Item Initial Fair Value Useful Life (years) PPE, net $220,000 10 Customer List 120,000 10 Goodwill 60,000 Indefinite $400,000 P Company and S Company report the following financial statements at December 31, 2023: Income Statement Parent Subsidiary Sales $ 6,500,000 $600,000 Cost of goods sold (4,250,000 ) (350,000 ) Gross Profit 2,250,000 250,000 Income (loss) from subsidiary 13,125 Operating expenses (1,250,000 ) (142,000 ) Net income $1,013,125 $108,000 Statement of Retained Earnings Parent Subsidiary BOY Retained Earnings $7,900,000 $ 958,000 Net income 1,013,125 108,000 Dividends (102,540 ) (18,750 ) EOY Retained Earnings $8,810,585 $1,047,250 Balance Sheet Parent Subsidiary Assets: Cash $ 500,000 $ 250,000 Accounts receivable 2,045,000 425,000 Inventory 657,000 624,500 Equity Investment 1,025,000 PPE, net 9,753,585 511,750 $13,980,585 $1,811,250 Liabilities and Stockholders' Equity: Current Liabilities $ 900,000 $ 370,000 Long-term Liabilities 1,570,000 0 Common Stock 600,000 42,000 APIC 2,100,000 352,000 Retained Earnings 8,810,585 1,047,250 $13,980,585 $1,811,250 Compute the amount of the beginning of year [ADJ] adjustment necessary for consolidation of the financial statements for the year ended December 31, 2023. Select one: A. $298,025 B. $284,400 C. $407,000 D. $271,775