Question: Problem 1-8 (LU 1-3, 1-4) 00 Franklin purchases 40 percent of Johnson Company on January 1 for $617,100. Although Franklin did not use it, this

Problem 1-8 (LU 1-3, 1-4) 00 Franklin purchases 40 percent of Johnson Company on January 1 for $617,100. Although Franklin did not use it, this acquisition gave Franklin the ability to apply significant influence to Johnson's operating and financing policies. Johnson reports assets on that date of $1,515,000 with liabilities of $548,000. One building with a seven-year remaining life life is undervalued on Johnson's books by $243,250. Also, Johnson's book value for its trademark (10-year life) is undervalued by $332,500. During the year, Johnson reports net income of $140,000 while declaring dividends of $70,000. What is the investment in Johnson Company balance (equity method) in Franklin's financial records as of December 31? points

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