The following information has been taken from the consolidation worksheet of Graham Company and its 80% owned subsidiary, Stage Company.

(1.) Graham reports a loss on sale of land of $5,000. The land cost Graham $20,000.

(2.) Non-controlling interest in Stage's net income was $30,000.

(3.) Graham paid dividends of $15,000.

(4.) Stage paid dividends of $10,000.

(5.) Excess acquisition-date fair value over book value was expensed by $6,000.

(6.) Consolidated accounts receivable decreased by $8,000.

(7.) Consolidated accounts payable decreased by $7,000.

How is the amount of excess acquisition-date fair value over book value recognized in a consolidated statement of cash flows assuming the indirect method is used?

$4,800 added to net income.

$4,800 subtracted from net income.

$6,000 added to net income.

$6,000 subtracted from net income.

It is ignored.