Patrick Corporation acquired 100 percent of OBrien Companys outstanding common stock on January 1, for $662,300 in cash. OBrien reported net assets with a carrying amount of $421,000 at that time. Some of OBriens assets either were unrecorded (having been internally developed) or had fair values that differed from book values as follows:

	Book Values		Fair Values
Trademarks (indefinite life)	$	89,000	$	195,000
Customer relationships (5-year remaining life)		0		102,000
Equipment (10-year remaining life)		387,000		340,800

Any goodwill is considered to have an indefinite life with no impairment charges during the year.

Following are financial statements at the end of the first year for these two companies prepared from their separately maintained accounting systems. OBrien declared and paid dividends in the same period. Credit balances are indicated by parentheses.

	Patrick				O'Brien
Revenues	$	(1,155,000	)		$	(572,000	)
Cost of goods sold		308,000				254,000
Depreciation expense		95,400				89,700
Amortization expense		34,400				0
Income from O'Brien		(212,520	)			0
Net income	$	(929,720	)		$	(228,300	)
Retained earnings 1/1	$	(744,000	)		$	(298,000	)
Net income		(929,720	)			(228,300	)
Dividends declared		153,000				91,000
Retained earnings 12/31	$	(1,520,720	)		$	(435,300	)
Cash	$	244,000			$	127,500
Receivables		340,000				81,000
Inventory		182,000				232,000
Investment in O'Brien		760,820				0
Trademarks		604,000				76,200
Customer relationships		0				0
Equipment (net)		1,074,000				281,000
Goodwill		0				0
Total assets	$	3,204,820			$	797,700
Liabilities	$	(1,284,100	)		$	(262,400	)
Common stock		(400,000	)			(100,000	)
Retained earnings 12/31		(1,520,720	)			(435,300	)
Total liabilities and equity	$	(3,204,820	)		$	(797,700	)

A.) Which investment method did Patrick use to compute the $212,520 income from O'Brien?

B.)Determine the totals to be reported for this business combination for the year ending December 31.

C.) Verify the totals determined in part (b) by producing a consolidation worksheet for Patrick and OBrien for the year ending December 31.