(ii) Determine the investment in Small at December 31, Year 8.

Large Ltd. purchased 80% of Small Company on January 1, Year 6, for $760,000, when the statement of financial position for Small showed common shares of $550,000 and retained earnings of $250,000. On that date, the inventory of Small was undervalued by $70,000, and a patent with an estimated remaining life of five years was overvalued by $88,000. Small reported the following subsequent to January 1, Year 6: Year 6 Year 7 Year 8 Profit (Loss) $140,000 (50,000) 105,000 Dividends $40,000 25,000 55,000 A test for goodwill impairment on December 31, Year 8, indicated a loss of $20,800 should be reported for Year 8 on the consolidated income statement. Large uses the cost method to account for its investment in Small and reported the following for Year 8 for its separate-entity statement of changes in equity: Retained earnings, beginning Profit Dividends Retained earnings, end $ 650,000 350,000 (55,000) 5.945,000