Pitino acquired 90 percent of Brey's outstanding shares on January 1, 2019, in exchange for $351,000 in cash. The subsidiary's stockholders' equity accounts totaled $335,000, and the noncontrolling interest had a fair value of $39,000 on that day. However, a building (with a ten-year remaining life) in Brey's accounting records was undervalued by $15,000. Pitino assigned the rest of the excess fair value over book value to Brey's patented technology (four-year remaining life). Brey reported net income from its own operations of $65,000 in 2019 and $81,000 in 2020. Brey declared dividends of $19,500 in 2019 and $23,500 in 2020. Brey sells inventory to Pitino as follows: Transfer Price Year Cost to Brey 2019 $ 70,000 2020 77,000 2021 99,000 to Pitino $ 120,000 140,000 165,000 Inventory Remaining at Year-End (at transfer price) $ 26,000 38,000 40,000 At December 31, 2021, Pitino owes Brey $17,000 for inventory acquired during the period. The following separate account balances are for these two companies for December 31, 2021, and the year then ended. Note: Parentheses indicate a credit balance. Sales revenues Cost of goods sold Equity in earnings of Brey Net income Pitino Brey 5 (864,000) 5(371,000) 516,000 185,500 210,000 60,000 (81,540) $ (244,040) (101,000) Retained earnings, 1/1/21 5 (490,000) $(280,000) Net income (above) (244,040) (101,000) Dividends declared. 130,000 20,000 Retained earnings, 12/31/21 $ (604,040) $(361,000) Cash and receivables. $ 147,000 $ 99,000. Inventory 260,000 141,000 Investment in Brey Land, buildings, and equipment (net) Total assets 965,000 $ 1,843,150 329,000 $569,000 471,150 O Liabilities Common stock Retained earnings, 12/31/21 Total liabilities and equity $ (719,110) (50,000) (520,000) (158,000) (604,040) (361,000) $(1,043,150) $(569,000)