On January 1, 2017, Prestige Corporation acquired 100 percent of the voting stock of Stylene Corporation in exchange for $2,218,000 in cash and securities. On the acquisition date, Stylene had the following balance sheet:

Cash$31,600Accounts payable$1,484,100Accounts receivable127,500Inventory181,000Equipment (net)1,760,000Common stock800,000Trademarks996,000Retained earnings812,000$3,096,100$3,096,100

At the acquisition date, the book values of Stylene's assets and liabilities were generally equivalent to their fair values except for the following assets:

AssetBook ValueFair ValueRemaining

Useful LifeEquipment$1,760,000$1,942,0008 yearsCustomer lists0206,0004 yearsTrademarks996,0001,060,000indefinite

During the next two years, Stylene has the following income and dividends in its own separately prepared financial reports to its parent.

Net IncomeDividends2017$264,000$25,0002018648,00045,000

Dividends are declared and paid in the same period. The December 31, 2018, separate financial statements for each company appear below. Parentheses indicate credit balances.

PrestigeStyleneIncome StatementRevenues$(6,080,000)$(3,460,000)Cost of goods sold3,240,0002,450,000Depreciation expense587,000362,000Amortization expense115,0000Equity earnings in Stylene(573,750)0Net income$(2,711,750)$(648,000)Statement of Retained EarningsRetained earnings 1/1$(3,650,000)$(1,051,000)Net income (above)(2,711,750)(648,000)Dividends declared150,00045,000Retained earnings 12/31$(6,211,750)$(1,654,000)Balance SheetCash$514,000$80,500Accounts receivable794,00081,000Inventory985,000488,000Investment in Stylene2,911,5000Equipment6,590,0002,137,500Customer lists179,0000Trademarks3,110,000912,000Goodwill185,0000Total assets$15,268,500$3,699,000Accounts payable$(556,750)$(1,245,000)Common stock(8,500,000)(800,000)Retained earnings, 12/31(6,211,750)(1,654,000)Total liabilities and equity$(15,268,500)$(3,699,000)

1. Determine the fair value in excess of book value for Prestige's acquisition date investment in Stylene.
2. Determine Prestige's December 31, 2018, Investment in Stylene balance.
3. Prepare a worksheet to determine the balances for Peregrine's December 31, 2018, consolidated financial statements.