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Assume an investee has the following financial statement information for the three years ending December 31, 2013:

(At December 31)	2011	2012	2013
Current assets	$517,500	$694,250	$713,675
Tangible fixed assets	1,407,500	1,435,750	1,654,325
Intangible assets	125,000	112,500	100,000
Total assets	$2,050,000	$2,242,500	$2,468,000
Current liabilities	$250,000	$275,000	$302,500
Noncurrent liabilities	550,000	605,000	665,500
Common stock	250,000	250,000	250,000
Additional paid-in capital	250,000	250,000	250,000
Retained earnings	750,000	862,500	1,000,000
Total liabilities and equity	$2,050,000	$2,242,500	$2,468,000

(At December 31)	2011	2012	2013
Revenues	$2,125,000	$2,300,000	$2,425,000
Expenses	1,937,500	2,100,000	2,190,000
Net income	$187,500	$200,000	$ 235,000
Dividends	$62,500	$ 87,500	$97,500

Review of pre-consolidation cost method (controlling investment in affiliate, fair value equals book value) Assume that on January 1, 2011, an investor company purchased 100% of the outstanding voting common stock of the investee. On the date of the acquisition, the investee's identifiable net assets had fair values that approximated their historical book values. In addition, the acquisition resulted in no goodwill or bargain purchase gain recognized in the consolidated financial statements of the investor company. Assuming that the investor company uses the cost method to account for its investment in the investee, what is the balance in the "investment in investee" account in the investor company's preconsolidation balance sheet on December 31, 2013?

$1,125,000

$1,250,000

$1,500,000

$2,468,000

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