1.On January 2, 2019, Owl Co. purchased a25% interest in Fox Co. for$650,000. On thisdate, Fox's stockholders' equity was$2,000,000. The carrying amounts of Fox's identifiable net assets approximated their fairvalues, except for land whose fair value exceeded its carrying amount by $500,000.For 2019, Fox reported net income of $300,000 and declared dividends of $40,000. Owl accounts for this investment using the equity method. In its December31, 2019 balance sheet, what amount should Owl report as investment inFox?

A) $650,000B) $725,000C) $910,000D) $715,000