Harvey died on November 7, Year 1, leaving his entire $2 million estate to his brother, Ken.Harvey's executor validly elected the alternate valuation date. Harvey's estate included 1,000 shares of Morbid stock for which Harvey's basis was $77,500. The stock was distributed to Ken on July 7, Year 2. The FMV of this stock over the 8 months following Harvey's death was as follows:

November 7, Year 1 = $85,000

May 7, Year 2 = $92,500

July 7, Year 2 = $94,500

Ken's basis in this stock is: