On January 1, 2015, Brooks Corporation exchanged $1,179,500 fair-value consideration for all of the outstanding voting stock of Chandler, Inc. At the acquisition date, Chandler had a book value equal to $1,027,500. Chandler's individual assets and liabilities had fair values equal to their respective book values except for the patented technology account, which was undervalued by $300,000 with an estimated remaining life of six years. The Chandler acquisition was Brooks's only business combination for the year. In case expected synergies did not materialize, Brooks Corporation wished to prepare for a potential future spin-off of Chandler, Inc. Therefore, Brooks had Chandler maintain its separate incorporation and independent accounting information system as elements of continuing value. On December 31, 2015, each company submitted the following financial statements for consolidation. Dividends were declared and paid in the same period. Corp. Chandler Inc. Income Statement Revenues Cost of goods sold Gain on bargain purchase Depreciation and amortization Equity earnings from Chandler $ (672,000) (653,000) 225,000 236,000 (148,000) 142,000 (228,000) 150,000 Net income S (670,000) (278,000) Statement of Retained Earnings Retained earnings, 1/1 Net income (above) Dividends declared S(1,745,000) $ (727,500) (278,000) 40,000 100,000 Retained earnings, 12/31 $(2,315,000) $ (965,500) Balance Sheet Current assets Investment in Chandler Trademarks Patented technology Equipment $ 396,500 441,500 1,515,500 119,000 392,000 638,000 207,000 444.000 316,000 Total assets $3,061,000 $1,408,500 Liabilities Common stock S (211,000) (143,000) (300,000) (535,000)