Problem 1-8 (Algo) (LO 1-4, 1-5) Franklin purchases 40 percent of Johnson Company on January 1 for $621,700. Although Franklin did not use it, this acquisition gave Franklin the ability to apply significant influence to Johnson's operating and financing policies. Johnson reports assets on that date of $1,482,000 with liabilities of $511,000. One building with a seven-year remaining life is undervalued on Johnson's books by $173,250. Also, Johnson's book value for its trademark (10-year remaining life) is undervalued by $410,000. During the year, Johnson reports net income of $185,000 while declaring dividends of $120,000. What is the Investment in Johnson Company balance (equity method) in Franklin's financial records as of December 31? Multiple Choice $631,300. $647,700. $695,400. $621,400