Small Company reported 20X7 net income of $40,000 and paid dividends of $15,000 during the year. Mock Corporation acquired 20 percent of Small's shares on January 1, 20X7, for $105,000. At December 31, 30X7, Mock determinded the fair value of the shares of Small to be $121,000. Mock reported operating income of $90,000 for 20X7.