On January 1, 2013, dawson, incorporated paid $100,000 for a 30% interest in sacco corporation. This investee had assets with a book value of $550,000 and liabilities of $ 300,000. A patent held by sacco having a book value of $10,000 was actually worth $40,000 with a six year remaining life. Any goodwill associated with this acquistion is considered to have an indefinite life. During 2013, sacco reported income of $50,000 and paid dividends of $20,000 while in 2014 it reported income of $75,000 and paid dividends of $30,000. Assume Dawson has the ability to significantly influence the operations of sacco.

The amount allocated to goodwill at January 1, 2013 is:

A. 25,000

B. 13,000

C. 9,000

D. 16,000

E. 10,000