Balance sheet, income, and dividend data for Amber Corporation, Blair Corporation, and Carmen Corporation at January 1, 20X3, were as follows:

On January 1, 20X3, Amber Corporation purchased 40 percent of the voting common stock of Blair Corporation by issuing common stock with a par value of $40,000 and fair value of $130,000. Immediately after this transaction, Blair purchased 25 percent of the voting common stock of Carmen Corporation by issuing bonds payable with a par value and market value of $51,500. On January 1, 20X3, the book values of Blair€™s net assets were equal to their fair values except for equipment that had a fair value $30,000 more than book value and patents that had a fair value $25,000 more than book value. At that date, the equipment had a remaining economic life of eightyears, and the patents had a remaining economic life of five years. The book values of Carmen€™s assets were equal to their fair values except for inventory that had a fair value $6,000 in excess of book value and was accounted for on a FIFO basis.

Required
a. Compute the net income reported by Amber Corporation for 20X3, assuming Amber and Blair used the equity method in accounting for their intercorporate investments.
b. Give all journal entries recorded by Amber relating to its investment in Blair during20X3.

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Amber Corporation Blair Corporation 60,000 80,000 90,000 350,000 580,000 Carmen Account Balances Corporation Cash Accounts Receivable inventory Fixed Assets (net) Total Assets 70,000 120,000 100,000 450,000 740,000 $ 20,000 40,000 65,000 240,000 $365,000 Accounts Payable Bonds Payable Common Stock Retained Earnings Total Liabilities & Equity $105,000 300,000 150,000 185,000 $740,000 $110,000 200,000 75,000 195,000 $580,000 45,000 120,000 90,000 110,000 $365,000 Income from Operations in 20X3 Net Income for 20X3 $220,000 $100,000 50,000 25,000 Dividends Declared & Paid 60,000 30,000