Phelps Co Uses the Sophisticated Equity Method to Account for the the 80

Phelps Co. uses the sophisticated equity method to account for the 80% investment in its subsidiary Shore Corp. At the time of the acquisition, the fair values of the net asset required approximated their book values. Based upon the following information, what amount does Phelps Co. record as subsidiary income?

A) $50,000
B) $44,000
C) $40,000
D) $36,000