Sultan Corporation pays $500,000 for a 20 percent interest in Chula Corporation on July 1, 2016, when Chula’s capitalstock is valued at $700,000, its retained earnings at $500,000, and the book value...

Sultan Corporation pays $500,000 for a 20 percent interest in Chula Corporation on July 1, 2016, when Chula’s capitalstock is valued at $700,000, its retained earnings at $500,000, and the book value of Chula’s net assets equals fairvalue. Additional information about Chula Corporation is given below: