0n January 1, 2019, Red acquires 100% of Yellow in a transaction structured as an acquisition, with Yellow surviving as a wholly owned subsidiary. The following are the terms of the transaction 1. Red pays $5,000,000 cash to Yellow's shareholders 2. Red issues 40,000 shares to Yellow's shareholders with a par value of $2 2, Red pays outside attorneys $100,000 to draft the purchase agreement 4. a share and a fair value of $70 a share. 3. Red pays outside accountants $60,000 to prepare financial statements for 5. 6. 7. the consolidated entity Red pays its own administrative staff $50,000 for their work on the acquisition Red pays underwriters $90,000 to register the shares issued on an exchange. Red agrees that if Yellow earns $900,000 during 2019, Red will pay an additional $1,500,000. At acquisition date, probability of that occurring is given at 35% How much will Red debit to its Investment in Yellow at January 1,2019