At the date of acquisition, a subsidiary's inventory (FIFO, sold in the year of acquisition) is overvalued by $500, its plant assets (10-year life, straight-line) are overvalued by $6,000, and it has previously unreported intangibles valued at $2,000 (2-year life, straight-line). Goodwill from the acquisition is not impaired in the year of acquisition. In the year of acquisition, the subsidiary reports net income of $2,500. Using the complete equity method, in the year of acquisition, the parent reports equity in the net income of the subsidiary of: a. $1,600 b. $3,100 c. $2,600 d. $ 400