On January 1, 2021, Fedders, Inc. paid $16 per share to a group of Veen, Inc. shareholders to acquire 60,000 shares of Veen's outstanding voting stock, representing a 60% ownership interest. The remaining 40,000 shares of Veen continued to trade in the market close to its recent average of $13.00 per share both before and after the acquisition by Fedders. Veen's acquisition date balance sheet follows: Current assets Property and equipment (net) Patents $28,000 Liabilities 536,000 Common stock 380,000 Retained earnings $944,000 $424,000 200,000 320,000 $944,000 On January 1, 2021, Fedders assessed the carrying amount of Veen's equipment (5-year remaining life) to be undervalued by $110,000. Fedders also determined that Veen possessed unrecorded patents (10- year remaining life) worth $570,000. Veen's acquisition-date fair-values for its current assets and liabilities were equal to their carrying amounts. Any remaining excess of Veen's acquisition-date fair- values over its book value was attributed to goodwill. The companies' financial statements for the year ending December 31, 2022 follow: Revenues Fedders ($1,281,000) Veen ($857,000) Cost of goods sold 650,000 400,000 Depreciation expense 160,000 68,000 Amortization expense 28,000 42,000 Other operating expenses 104,000 127,000 Equity in Veen earnings (84,600) 0 Separate company net income ($423,600) ($220,000) Retained earnings 1/1 ($1,640,400) ($593,000) Net income (423,600) (220,000) Dividends declared 100,000 60,000 Retained earnings 12/31 ($1,964,000) ($753,000) Current assets $250,000 $163,000 Investment in Veen 1,125,000 0 Property and equipment (net) 1,674,000 518,000 Patents 298,000 295,000 Total assets $3,347,000 $976,000 Liabilities ($743,000) ($23,000) Common stock - Fedders (640,000) 0 Common stock - Veen 0 (200,000) Retained earnings (1,964,000) (753,000) Total liabilities and owners' equity ($3,347,000) ($976,000)