3. Prepare journal entries to record the facts in the case, assuming that Cappio uses the equity method to account for the investment. Cappio owns 33 percent of Maxwell and Maxwell reported $60,000 of net income each year. (If no entry is required for a transaction/event, select"No Journal Entry Required" in the first account field.) View transaction list Record the purchase of 1,000 shares (33%) of Maxwell Company for $34,000. The company will record the investment under the equity method of accounting. 1 $34,000 Record the entry to recognize earnings from Cappio's investment in Maxwell. Maxwell reported net income of $60,000 in 2014. 2 Record the receipt of cash dividends of $5 per share on June 1, 2015. 3 Credit Record the entry to recognize earnings from Cappio's investment in Maxwell. Maxwell reported net income of $60,000 in 2015. 4 Note: journal entry has been entered Record entry Clear entry View general journal