When It Purchased Sutton, Inc Immediately After the Purchase, the Consolidated Balance Sheet Should Report

When it purchased Sutton, Inc.on January 1, 2016, Pavin Corporation issued 500,000 shares of its $5 par voting common stock.On that date the fair value of those shares totaled $4,200,000.Related to the acquisition, Pavin had payments to the attorneys and accountants of $200,000, and stock issuance fees of $100,000.Immediately prior to the purchase, the equity sections of the two firms appeared as follows:
$\begin{array}{lrr} & \underline { \text { Pavin } } & \text { Sutton } \\\text { Common stock } & \$ 4,000,000 & \$ 700,000 \\\text { Paid-in capital in excess of par } & 7,500,000 & 900,000 \\\text { Retained earnings } & 5,500,000 & 500,000 \\\text { Total } & \$ 17,000,000 & \$ 2,100,000\end{array}$
Immediately after the purchase, the consolidated balance sheet should report retained earnings of:

A) $6,000,000
B) $5,800,000
C) $5,500,000
D) $5,300,000