Question 27 (1 point) Hope Company bought 30% of Faith Corporation in the beginning of 2018. Hope's purchase price equaled 30% of the book value of Faith's net identifiable assets. which also equaled 30% of the fair value of Faith. During 2018, Faith reported net income in the amount of $4,000,000 and declared and paid dividends in the amount of $500,000. Hope mistakenly accounted for the investment using the fair value through net income method instead of using the equity method. What effect would this error have on the investment account and net income, respectively, for 2018? Overstated by $1,050,000; understated by $1,050,000. Understated by $1,050,000; understated by $1,050,000. Understated by $1,200,000; overstated by $1,050,000. Overstated by $1,200,000; overstated by $1,200,000