On January 1 of Year 1, Dridge Company purchased 2,500 shares of the 10,000 outstanding shares of Company C for a total of $100,000. At the time of the purchase, the book value of Company C's equity was $300,000. Company C assets having a fair value greater than book value at the time of the acquisition were as follows:

Company C's net income in Year 1 was $70,000. Dividends per share paid by Company C were $2.00 in Year 1. (1) Make all journal entries necessary on Dridge's books to record its investment in Company C in Year 1. Assume that the goodwill is not impaired. (2) Compute the Year 1 ending balance in Dridge Company's investment in Company Caccount.

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Book Value Fair Value Remaining Asset Life Inventory.... Building Goodwill 40,000 200,000 50,000 250,000 40,000 less than I year 10 years indefinite