Sears, Roebuck and Co. owns equity-method investments in several companies. Suppose Sears paid \(\$ 2\) million to acquire a 25 -percent investment in All-Star Company. Assume that All-Star Company reported net income of \(\$ 640,000\) for the first year and declared and paid cash dividends of \(\$ 420,000\). Record the following in Sears's general journal:

(a) purchase of the investment,

(b) Sears's proportion of All-Star's net income, and

(c) receipt of the cash dividends.