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Placid Lake Corporation acquired 80 percent of the outstanding voting stock of Scenic, Inc., on...

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Accounting

Placid Lake Corporation acquired 80 percent of the outstanding voting stock of Scenic, Inc., on January 1,2020, when Scenic had a net book value of $400,000. Any excess fair value was assigned to intangible assets and amortized at a rate of $5,000 per year.
Placid Lake's 2021 net income before consideration of its relationship with Scenic (and before adjustments for intra-entity sales) was $300,000. Scenic reported net income of $110,000. Placid Lake declared $100,000 in dividends during this period; Scenic paid $40,000. At the end of 2021, selected figures from the two companies' balance sheets were as follows:
\table[[,Placid Lake,Scenic],[Inventory,$140,000,$90,000
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