Marie Inc. and Nick Inc. formed a joint venture on January 1, 2016 to produce and sell custom-fit earphones and earplugs. Marie invested plant and equipment with a book value of $250,000 and a fair value of $400,000 for a 25% interest in the venture which was to be called Jola Inc. Nick Inc. contributed raw materials (i.e. silicone and packing materials) with a fair value of $650,000 and cash of $550,000 for its 75% stake in Jola Inc. Jola Inc. reported net income of $2,200,000 for 2016. Marie Inc.s plant and equipment has a 5 year remaining life as of January 1, 2016. Ignore income taxes.

What is the amount of the gain or loss that Marie Inc. can recognize on January 1, 2016 arising from the transfer of its assets to Jola Inc.? Provide the journal entry that Marie Inc. will record for 2016 to reflect its share of Jola Inc.s net income