Kho Inc. purchased 90% of the voting shares of Lan Inc. for $600,000 on January 1, 2019. On that date, Lan's common shares and retained earnings were valued at $200,000 and $250,000 respectively. Unless otherwise stated, assume that Kho uses the cost method to account for its investment in Lan Inc.

Lan's fair values approximated its carrying values with the following exceptions:

Lan's trademark had a fair value which was $50,000 higher than its carrying value.

Lan's bonds payable had a fair value which was $20,000 higher than their carrying value.

The trademark had a useful life of exactly ten years remaining from the date of acquisition. The bonds payable mature on January 1, 2029. Both companies use straight line amortization exclusively.

The financial statements of both companies for the year ended December 31, 2020 are shown below: