Advanced Accounting 10th Edition by Thomas Schaefer, Joe Ben Hoyle, Timothy Doupnik

Exercise 4

Note: Problems 1 through 37 assume the use of the acquisition method.Problems 38 through 40 assume the use of the purchase method. On January 1, 2011, Brendan, Inc., reports net assets of $760,000 although equipment (with a four-year life) having a book value of $440,000 is worth $500,000 and an unrecorded patent is valued at $45,000.Hope Corporation pays $692,000 on that date for an 80 percent ownership in Brendan.If the patent is to be written off over a 10-year period, at what amount should it be reported on consolidated statements at December 31, 2012
A)$28,800.
B)$32,400.
C)$36,000.
D)$40,500.