Zeng Jewelers purchased 18,000,000 of the outstanding 60,000,000 shares of Angel & Associates. Zeng ...

Zeng Jewelers purchased 18,000,000 of the outstanding 60,000,000 shares of Angel & Associates.  Zeng has significant influence over Angel, so Zeng will account for this investment using the equity method.  On the purchase date, Angel had net assets with a book value of $7,300,000 and a fair value of $7,500,000.  The difference in fair value is a result of the higher fair value of equipment than its book value.  The remaining useful life of this equipment is 25 years.  Assuming this investment was purchased on 1/1, how will Zeng record the difference in net assets for this investment on 12/31?
A) The higher fair value will allow Zeng to increase the Investment account and Income from Investment by $8,000 each year.
B) The additional depreciation expense will decrease the Income from Investment as well as the Investment account by $2,400.
C) The higher fair value will allow JayBird to increase the Investment account and Income from Investment by $2,400 each year.
D) The additional depreciation expense will decrease the Income from Investment as well as the Investment account by $8,000.