Question

during 2016, and a o00,000 net inriss for $1,000,000 on January 1, 2016. Sonny during 2016, and at December 31, 2016, the market value o 10% of Sonny Enterprises for SI,000,000 on cember 31, 20g 2016, paid $30,000 of dividends to Fredo 6. Fred,Inc., purchased a total of $400,000 net income during pard the Sonny investment increased to $1,040,000 Required: Prepare the journal entries necessary to account for the Sonny investment, assuming that Fredo accounts for that investment fair-value option. an available- as (1) an available-for-sale investment, and (2) elects the Dhesinant 100000o On January 1, 2016, American Corporation purchased 30% of the outstanding voting shares of Short Supplies common stock for $200,000 cash. On that date, Short's book value and fair alue were both $800,000. The equity method is deemed appropriate for this investment. hort's net income reported on December 31, 2016, was $90,000. During 2016, Short also id cash dividends in the amount of $24,000. quired: are the journal entries necessary to record the above information on Am oration's books during 2016. erican Commnsleck 200 ,000 Cash ,odo

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