Royce Co. acquired 60% of Park Co. for $420,000 on December 31, 2019 when Park's book value was $560,000. The Royce stock was not actively traded. On the date of acquisition, Park had equipment (with a ten-year life) that was undervalued in the financial records by $140,000. One year later, the two companies provided the selected amounts shown below. Additionally, no dividends have been paid. Royce Co.Park Co. Book ValueBook ValueFair ValueCurrent assets$868,000 $420,000 $448,000 Equipment 364,000 280,000 400,000 Buildings 574,000 210,000 210,000 Liabilities (546,000) (168,000) (168,000)Revenues (1,260,000) (560,000) Expenses 700,000 420,000 Investment income Not Given ?What is the consolidated balance of the Equipment account at
December 31, 2020?
A. $784,000.
B. $644,400.
C. $770,000.
D. $719,600.
E. $775,600.
Answer: C
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