Figure:
Watkins, Inc -If Watkins Pays $450,000 in Cash for Glen, What Amount

Figure:
Watkins, Inc. acquires all of the outstanding stock of Glen Corporation on January 1, 2010. At that date, Glen owns only three assets and has no liabilities: $$\begin{array} { | l | r | r | } \hline & \text { Book } & \text { Fair } \\\hline & \text { Value } & \text { Value } \\\hline \text { Inventory (FIFO method) } & \$ 40,000 & \$ 50,000 \\\hline \text { Equipment (10-year life) } & 80,000 & 75,000 \\\hline \text { Building (20-year life) } & 200,000 & 300,000 \\\hline\end{array}$$
-If Watkins pays $450,000 in cash for Glen, what amount would be represented as the subsidiary's Equipment in a consolidation at December 31, 2012, assuming the book value of the equipment at that date is still $80,000?

A) $70,000.
B) $73,500.
C) $75,000.
D) $76,500.
E) $80,000.