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How do i get the 700,000? Assume an investee has the following financial statement information for the three years ending December 31, 2016 (At December

image text in transcribedHow do i get the 700,000?

Assume an investee has the following financial statement information for the three years ending December 31, 2016 (At December 31) Current assets Tangible fixed assets Intangible assets Total assets 2016 2014 2015 $228,376 $222,160 $165,600 529,384 459,440 450,400 32,000 36,000 40,000 $789,760 $717,600 $656,000 Current liabilities Noncurrent liabilities Common stock Additional paid-in capital Retained earnings Stockholders' equity Total liabilities and equity $96,800 $88,000 $80,000 212,960 193,600 176,000 80,000 80,000 80,000 80,000 320,000 276,000 240,000 480,000 436,000 400,000 $789,760 $717,600 $656,000 80,000 80,000 (For the years ended December 31) Revenues Expenses Net income 2016 2014 2015 $776,000 $736,000 $680,000 700,800 672,000 620,000 $75,200 $64,000 $60,000 Dividend:s $31,200 $28,000 $20,000 Assume that on January 1, 2014, an investor company purchased 100% of the outstanding voting common stock of the investee. On the date of the acquisition, the investee's identifiable net assets had fair values that approximated their historical book values, except for tangible fixed assets, which had fair value that was $90,000 higher than the investee's recorded book value. The tangible fixed assets had a remaining useful life of 6 years. In addition, the acquisition resulted in goodwill in the amount of $175,000 recognized in the consolidated financial statements of the investor company. Assuming that the investor company uses the equity method to account for its investment in the investee, what is the balance in the "investment in investee" account in the investor company's pre-consolidation balance sheet on December 31, 2016? $480,000 $625,000 $700,000 $789,760

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