On January 1, 2020, Holland Corporation paid $7 per share to a group of Zeeland Corporation shareholders to acquire 60,000 shares of Zeeland's outstanding voting stock, representing a 60 percent ownership interest. The remaining 40,000 shares of Zeeland continued to trade in the market close to its recent average of $5.50 per share both before and after the acquisition by Holland. Zeeland's acquisition date balance sheet follows: Current assets Property and equipment (net) Patents $ 15,100 229,100 204,300 $ 448,500 Liabilities Common stock Retained earnings $228,500 100,000 120,000 $ 448,500 On January 1, 2020, Holland assessed the carrying amount of Zeeland's equipment (5-year remaining life) to be undervalued by $66,000. Holland also determined that Zeeland possessed unrecorded patents (10-year remaining life) worth $254,600. Zeeland's acquisition-date fair values for its current assets and liabilities were equal to their carrying amounts. Any remaining excess of Zeeland's acquisition-date fair value over its book value was attributed to goodwill. The companies' financial statements for the year ending December 31, 2021, follow: Sales Cost of goods sold Depreciation expense Amortization expense Other operating expenses Equity in Zeeland earnings Separate company net income Retained earnings 1/1 Net income Dividends declared Retained earnings 12/31 Holland $ (769,200) 389,900 Zeeland $ (439,500) 205,500 96,500 32,900 15,100 56,400 (49,404) 19,900 60,200 0 $ (260,704) $ (821,300) (260,704) 50,000 $(1,032,004) $ (121,000) $ (326,200) (121,000) 30,000 $(417,200) Current assets Investment in Zeeland Property and equipment (net) Patents Total assets Liabilities Common stock-Holland Common stock-Zeeland Retained earnings 12/31 Total liabilities and owners equity $ 126,100 $ 92,500 551,928 0 848,000 270,000 158,500 151,200 $ 1,677,228 $ (325,224) (320,000) 0 (1,032,004) $(1,677,228) $ 521,000 $ (3,800) 0 (100,000) (417,200) $ (521,000)