Use the Following Information to Answer Bellow Questions:
a Subsidiary

Multiple Choice

Use the following information to answer bellow Questions:
A subsidiary is acquired on January 1, 2019 for $10,000. The subsidiary's book value at the date of acquisition was $2,000. Following is revaluation information for the subsidiary's identifiable net assets at the date of acquisition:
$$\begin{array} { l c l } & \text { Fair Value - Book Value } & \\\cline { 2 - 3 } \text { Inventories } & \$ ( 200 \} & \text { FIFO, sold in 2019 } \\\text { Identifiable int angibles } & 5,000 & \text { Straight-line, 5 years } \\\text { Long term debt } & 300 & \text { Straight-line, 2 years }\end{array}$$ Goodwill recognized in the acquisition was unimpaired in 2019 but became fully impaired during 2020. The subsidiary did not declare any dividends during this period and reported no other comprehensive income. The subsidiary reported net income as follows:
$$\begin{array} { l r } \text { Year } & \text { Net Income } \\\hline 2019 & \$ 1,500 \\2020 & 5,000 \\2021 & 2,000\end{array}$$ The parent uses the complete equity method to report its investment on its own books.
-Equity in net income for 2021, reported on the parent's books, is:

A) $1,150
B) $1,000
C) $ 850
D) $1,350