On January 1, Year 1, RAK, Inc. acquired a 25% interest in Tech Corp. for $375,000. At the date of acquisition, the net assets had a fair value in excess of shareholders' equity of $200,000. The fair value in excess of book value is the result of equipment with a remaining useful life of four years. For the year ended December 31, Year 1. Tech hadnet income of $60,000 and RAK received a dividend of $10,000 from Tech. At December 31, Year 1, Tech had shareholders' equity of $820,000. What amount would RAK show as investment in Tech Corp. at the end of Year 1?

$380,000 $375.000 $367,500 $357,500