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

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, and Glen earns $50,000 in net income and pays $20,000 in dividends during 2010, what amount would be reflected in consolidated net income for 2010 as a result of the acquisition?

A) $20,000 under the initital value method.
B) $30,000 under the partial equity method.
C) $50,000 under the partial equity method.
D) $44,500 under the equity method.
E) $34,500 regardless of the internal accounting method used.