On January 1, 2024, Alamar Corporation acquired a 35 percent interest in Burks, Incorporated, for $235,000. On that date, Burks's balance sheet disclosed net assets with both a fair and book value of $347,000. During 2024, Burks reported net income of $79,000 and declared and paid cash dividends of $24,000. Alamar sold inventory costing $22,000 to Burks during 2024 for $44,000. Burks used all of this merchandise in its operations during 2024. Required: Prepare all of Alamar's 2024 journal entries to apply the equity method to this investment. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. View transaction list Journal entry worksheet < 1 2 3 Record the investee dividend declaration. Note: Enter debits before credits. 5 Transaction C General Journal Debit Credit

Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
ChapterA2: Investments
Section: Chapter Questions
Problem 25E
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On January 1, 2024, Alamar Corporation acquired a 35 percent interest in Burks, Incorporated, for $235,000. On that date, Burks's
balance sheet disclosed net assets with both a fair and book value of $347,000. During 2024, Burks reported net income of $79,000
and declared and paid cash dividends of $24,000. Alamar sold inventory costing $22,000 to Burks during 2024 for $44,000. Burks
used all of this merchandise in its operations during 2024.
Required:
Prepare all of Alamar's 2024 journal entries to apply the equity method to this investment.
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
View transaction list
Journal entry worksheet
< 1 2 3
Note: Enter debits before credits.
4
Record the investee dividend declaration.
Transaction
с
5
General Journal
Debit
Credit
Transcribed Image Text:On January 1, 2024, Alamar Corporation acquired a 35 percent interest in Burks, Incorporated, for $235,000. On that date, Burks's balance sheet disclosed net assets with both a fair and book value of $347,000. During 2024, Burks reported net income of $79,000 and declared and paid cash dividends of $24,000. Alamar sold inventory costing $22,000 to Burks during 2024 for $44,000. Burks used all of this merchandise in its operations during 2024. Required: Prepare all of Alamar's 2024 journal entries to apply the equity method to this investment. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. View transaction list Journal entry worksheet < 1 2 3 Note: Enter debits before credits. 4 Record the investee dividend declaration. Transaction с 5 General Journal Debit Credit
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