Equity method entries. Hanna Company purchased KM) percent of the common stock of Denver Company on January 2 for $550,000. The common stock of Denver Company at this dale was $2()(),()()(), and the retained earnings balance was $350,000. During the year, net income of Denver Company was $120,000: dividends declared were $30,000. Hanna Company uses the equity method to account for the investment. Give the journal entries that Hanna Company made during the year to account for its investment in Denver Company.