Assume that Horicon Corp acquired 25% of the common stock of Sheboygan Corp. on January 1, 2014, for $300,000. During 2014 Sheboygan Corp. reported net income of $160,000 and paid total dividends of $60,000.

If Horicon uses the equity method to account for its investment, the balance in the investment account on December 31, 2014, will be:

(a) $300,000.

(b) $325,000.

(c) $400,000.

(d) $340,000.