On January 1, 2016, Monica Company acquired 70 percent of Young Company's outstanding common stock for $672,000. The fair value of the noncontrolling interest at the acquisition date was $288,000. Young reported stockholders' equity accounts on that date as follows Common stock Additional paid-in capital Retained earnings 200,000 80,000 420,000 -$10 par value In establishing the acquisition value, Monica appraised Young's assets and ascertained that the accounting records undervalued a building (with a five-year remaining life) by $60,000. Any remaining excess acquisition-date fair value was allocated to a franchise agreement to be amortized over 10 years During the subsequent years, Young sold Monica inventory at a 20 percent gross profit rate. Monica consistently resold this merchandise in the year of acquisition or in the period immediately following. Transfers for the three years after this business combination was created amounted to the following Year 2016 2017 2018 Transfer Price 30,000 50,000 60,000 Inventory Remaining at Year-End (at transfer price) 11,000 13,000 19,000 In addition, Monica sold Young several pieces of fully depreciated equipment on January 1, 2017, for $37,000. The equipment had originally cost Monica $52,000. Young plans to depreciate these assets over a 5-year period In 2018, Young earns a net income of $150,000 and declares and pays $30,000 in cash dividends. These figures increase the subsidiary's Retained Earnings to a $750,000 balance at the end of 2018 On January 1, 2016, Monica Company acquired 70 percent of Young Company's outstanding common stock for $672,000. The fair value of the noncontrolling interest at the acquisition date was $288,000. Young reported stockholders' equity accounts on that date as follows Common stock Additional paid-in capital Retained earnings 200,000 80,000 420,000 -$10 par value In establishing the acquisition value, Monica appraised Young's assets and ascertained that the accounting records undervalued a building (with a five-year remaining life) by $60,000. Any remaining excess acquisition-date fair value was allocated to a franchise agreement to be amortized over 10 years During the subsequent years, Young sold Monica inventory at a 20 percent gross profit rate. Monica consistently resold this merchandise in the year of acquisition or in the period immediately following. Transfers for the three years after this business combination was created amounted to the following Year 2016 2017 2018 Transfer Price 30,000 50,000 60,000 Inventory Remaining at Year-End (at transfer price) 11,000 13,000 19,000 In addition, Monica sold Young several pieces of fully depreciated equipment on January 1, 2017, for $37,000. The equipment had originally cost Monica $52,000. Young plans to depreciate these assets over a 5-year period In 2018, Young earns a net income of $150,000 and declares and pays $30,000 in cash dividends. These figures increase the subsidiary's Retained Earnings to a $750,000 balance at the end of 2018