On January 1, 2020, a U Required
A

On January 1, 2020, a U.S. parent paid KYD 1,800,000 to acquire a subsidiary in the Cayman Islands. The excess paid over book value, KYD 1,000,000, was attributed entirely to goodwill. Goodwill impairment for 2020 was KYD 50,000.
The subsidiary's translated trial balance at December 31, 2020 is below, in U.S. dollars.
$$\begin{array}{l}\begin{array} { | l | r | } \hline & \text { Dr (Cr) } \\\hline \text { Cash \& receivables } & \$ 462,000 \\\hline \text { Inventories, at cost } & 977,500 \\\hline \text { Buildings \& equipment, net } & 3,220,000 \\\hline \text { Accounts and notes payable } & ( 3,369,500 ) \\\hline \text { Capital stock } & ( 360,000 ) \\\hline \text { Retained earnings, beginning } & ( 600,000 ) \\\hline \text { Sales revenue } & ( 7,080,000 ) \\\hline \text { Cost of goods sold } & 4,484,000 \\\hline \text { Operating expenses } & 2,214,000 \\\hline \text { Other comprehensive loss } & 52,000 \\\hline & \$ \text { S } \\\hline\end{array}\\\\\text { Exchange rates (\$/KYD) are: }\\\\\begin{array} { l r } \text { January } 1,2020 & \$ 1.20 \\\text { Average for 2020 } & 1.22 \\\text { December 31, 2020 } & 1.25\end{array}\end{array}$$ Required
a. Calculate the December 31, 2020 balance for the parent's investment in subsidiary, on its own books. The parent uses the complete equity method to report its investment.
b. Prepare eliminating entries (C), (E), (R), and (O) to consolidate the trial balances of the parent and its subsidiary at December 31, 2020.