On January 4, 2021, Mason Co. purchased 40,000 shares (40%) of the common stock of Hefly Corp., paying $560,000. At that time, the book value and fair value of Hefly's net assets was $1,400,000. The investment gave Mason the ability to exercise significant influence over the operations of Hefly. During 2021, Hefly reported income of $150,000 and paid dividends of $40,000. On January 2, 2022, Mason sold 10,000 shares for $150,000.What is the balance in the investment account after the sale of the 10,000 shares?

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The initial investment was $560,000. Mason's share of Hefly's income for 2021 is 40% of $150,000, which is $60,000. The dividends received are 40% of $40,000, which is $16,000. The investment account is increased by the share of income and decreased by the dividends: $560,000 + $60,000 - $16,000 = $604,000. After selling 10,000 shares (25% of the investment), the balance is reduced by 25% of $604,000, which is $151,000, resulting in a balance of $453,000.