In 2011 Ace Inc. acquired a 100% equity interest in Beauty Co. for cash consideration of $125,000. Beauty's identifiable net assets at fair value were $100,000. Goodwill of $5,000 was identified and recognized.

In the subsequent years Beauty increased net assets by $20,000 to $120,000. This is reflected in equity attributable to the parent. Ace then dispose of 30% of its equity interest to non-controlling interest for $40,000.

What is the increase or decrease to be recorded in equity?

Select one:

a.

Positive $5,000

b.

Negative $4,000

c.

Positive $4,000

d.

Negative $5,000