On January 1, 2020, Prestige Corporation acquired 100 percent of the voting stock of Stylene Corporation in exchange for $2,293,000 in cash and securities. On the acquisition date, Stylene had the following balance sheet:

Cash	$	33,400	Accounts payable	$	1,889,900
Accounts receivable		124,500
Inventory		202,000
Equipment (net)		2,160,000	Common stock		800,000
Trademarks		992,000	Retained earnings		822,000
Total assets	$	3,511,900	Total liabilities and equity	$	3,511,900

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

Asset	Book Value		Fair Value		Remaining Useful Life
Equipment	$	2,160,000	$	2,301,000	8 years
Customer lists		0		237,000	4 years
Trademarks		992,000		1,063,000	indefinite

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

	Net Income		Dividends
2020	$	266,000	$	25,000
2021		394,000		45,000

Dividends are declared and paid in the same period. The December 31, 2021, separate financial statements for each company follow. Parentheses indicate credit balances.

	Prestige				Stylene
Income Statement
Revenues	$	(4,260,000	)		$	(2,942,000	)
Cost of goods sold		2,330,000				2,080,000
Depreciation expense		538,000				468,000
Amortization expense		117,000				0
Equity earnings in Stylene		(317,125	)			0
Net income	$	(1,592,125	)		$	(394,000	)
Statement of Retained Earnings
Retained earnings 1/1	$	(3,140,000	)		$	(1,063,000	)
Net income (above)		(1,592,125	)			(394,000	)
Dividends declared		150,000				45,000
Retained earnings 12/31	$	(4,582,125	)		$	(1,412,000	)
Balance Sheet
Cash	$	580,000			$	84,000
Accounts receivable		862,000				108,500
Inventory		981,000				574,000
Investment in Stylene		2,729,250				0
Equipment		6,040,000				1,867,500
Customer lists		191,000				0
Trademarks		2,660,000				1,038,000
Goodwill		221,000				0
Total assets	$	14,264,250			$	3,672,000
Accounts payable	$	(1,182,125	)		$	(1,460,000	)
Common stock		(8,500,000	)			(800,000	)
Retained earnings, 12/31		(4,582,125	)			(1,412,000	)
Total liabilities and equity	$	(14,264,250	)		$	(3,672,000	)

1. Determine the fair value in excess of book value for Prestiges acquisition date investment in Stylene.

2. Determine Prestige's December 31, 2021, Investment in Stylene balance.

3. Prepare a worksheet to determine the balances for Prestiges December 31, 2021, consolidated financial statements.