Parent acquires 100 percent of Subsidiary's outstanding stock on December 31, 2022, by issuing 100,000 shares of its own no par stock to Subsidiary's shareholders. The no par stock has a market value of $30 per share. This acquisition is arranged as a nontaxable transaction. Therefore, all assets and liabilities will retain their carryover bases for tax purposes. A 40 percent effective corporate income tax rate for both Parent and Subsidiary. Below table summarizes Subsidiary's information at the acquisition date. Note that the Fair Value of all assets and liabilities is given, except for the Deferred Tax Asset and the Deferred Tax Liability. Book Value Subsidiary Fair Value Tax Basis Cash $100,000 $100,000 $100,000 Accounts receivable, net $700,000 $600,000 $900,000 Inventory $500,000 $500,000 $500,000 Deferred tax asset $80,000 ? Land $1,000,000 $1,200,000 $1,000,000 Property, plant, & $1,000,000 $1,200,000 $800,000 equipment, net Patent $100,000 Total Assets $3,380,000 Accounts payable Deferred tax liability Common stock $800,000 $800,000 $800,000 $80,000 ? $1,500,000 Retained earnings $1,000,000 Total Liabilities & Equity $3,380,000