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On January $1,2022,$ Palmcroft Company acquired $100$ percent of the outstanding voting shares of Salt River, Incorporated,

for $$760,000$ cash. At January $1,2022,$ Salt River's net assets had a total carrying amount of $$532,000.$ Equipment $($eight$-$

year remaining life$)$ was undervalued on Salt River's financial records by $$111,000.$ Any remaining excess fair over book

value was attributed to a database developed by Salt River $($four$-$year remaining life$),$ but not recorded on its books.

Palmcroft applies the equity method to account for its investment in Salt River. Each year since the acquisition, Salt River

has declared a $$40,000$ dividend. Salt River recorded net income of $$109,000$ in $2022$ and $$125,100$ in $2023.$

Selected account balances from the two companies' individual records were as follows:

$5.$What is consolidated net income for Palmcroft and Salt River for $2024?$

Multiple Choice

$$254,475$

$$199,000$

$$279,475$

$$289,475$

$6.$What is Palmcroft$$s consolidated retained earnings balance at December $31,2024?$

Multiple Choice

$$199,000$

$$279,475$

$$289,475$

$$306,875$

$7.$On its December $31,2024,$ consolidated balance sheet, what amount should Palmcroft report for Salt River$$s database?

Multiple Choice

$$11,700$

$$23,400$

$$58,500$

$$29,250$

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