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On January 2, 20x1, Adelphi Corp. issued shares of its common stock for all of the outstanding common stock of Scott Inc. Scott's book value of owners' equities was only $135,000 at the time. Adelphi issued 12,000 shares having a par value of $1 per share and a fair value of $20 per share. Adelphi also paid additional $10,000 for stock registration fees and $40,000 for hiring external bankers. Adelphi was willing to convey these shares because it felt that buildings (ten-year life) were undervalued on Scott's records by $60,000 and patent technology (five-year life) was undervalued by $20,000. Any excess cost over fair value is assigned to goodwill. Scott reported depreciation expenses on its buildings and amortization expenses on its patent technology. The following information was records for both company in 20x1 and 20x2. Adelphi used full equity method to report this investment. Neither Adelphi nor Scott issued new shares or bought back shares after this acquisition. (1) Owners' equities for both companies before business combination, January 1, 2x01. Adelphi Scott Common Stocks (beg. of year) 100,000 1,200,000 10,000 45,000 APIC (beg. of year) Retain Earnings (beg. of year) 1,900,000 80,000 (2) Income statements and dividends declared for both companies for 20x1 and 20x2 20x1 20x2 Adelphi Scott Adelphi Scott Revenues 600,000 700,000 280,000 230,000 120,000 Expenses 440,000 460,000 150,000 ? 0 ? 0 Investment Income 80,000 50,000 90,000 40,000 Dividends Declared What is the amount of goodwill recognized in this business combination? Select one: a. $35,000. b. $25,000. c. $15,000. d. $30,000. ** Same information as above ** What is the amount of consolidated retained earnings immediately after this stock acquisition on January 2, 20x1? Select one: a. $1,850,000 b. $1,980,000. c. $1,900,000. d. $1,860,000. ** Same information as above ** What is the amount of consolidated additional paid-in-capital immediately after this stock acquisition January 2, 20x1? Select one: a. $1,428,000. b. $1,418,000. 1245 ** Same information as above ** What is the amount of Investment on Scott reported by Adelphi Corp. as of December 31, 20x1 before consolidation? Select one: a. $320,000. b. $460,000. c. $300,000. d. $290,000