On January 1, 2018, Pomegranate Company acquired 90% of the voting stock of Starfruit Company for $91,700,000 in cash. The fair value of the noncontrolling interest in Starfruit at the date of acquisition was $6,300,000. Starfruits book value was $13,000,000 at the date of acquisition. Starfruits assets and liabilities were reported on its books at values approximating fair value, except its plant and equipment (10-year life, straight-line) was overvalued by $25,000,000. Starfruit Company had previously unreported intangible assets, with a market value of $40,000,000 and 5-year life, straight-line, which were capitalized following GAAP.

Additional information:

Pomegranate uses the complete equity method to account for its investment in Starfruit on its own books. Goodwill recognized in this acquisition was impaired by a total of $2,000,000 in 2018 and 2019, and by $500,000 in 2020. It is now December 31, 2020, the accounting year-end. Here is Starfruit Companys trial balance at December 31, 2020:

	Dr (Cr)
Current assets	$28,200,000
Plant & equipment, net	188,000,000
Intangibles	2,000,000
Liabilities	(180,000,000)
Capital stock	(1,000,000)
Retained earnings, January 1	(29,500,000)
Acumulated other comprehensive income, January 1	(500,000)
Dividends	400,000
Sales revenue	(24,000,000)
Cost of goods sold	10,000,000
Operating expenses	6,500,000
Other comprehensive income	(100,000)
	$ 0

On the 2020 consolidation working paper, eliminating entry (R) reduces the Investment in Starfruit by

$ 3,600,000

$64,800,000

$68,200,000

$81,000,000