Palm Corporation acquired all of the stock of Sequoia Company, with an acquisition cost that was $4,000,000 in excess of Sequoias $2,000,000 book value. All of Sequoia's assets and liabilities are carried at amounts approximating fair value, except that land is overvalued by $600,000 and long-term debt is undervalued by $1,000,000. When preparing the eliminating workpaper entries, which of the following is FALSE (Points : 2)

Elimination (E) reduces the investment by $2,000,000 Elimination (R) increases long-term debt by $1,000,000 Elimination (R) reduces the investment by $4,000,000 Elimination (R) increases goodwill by $3,400,000 All of the above are false