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Accounting for equity investments On January 1, 2024, Bark Company invests $10,000 in Roots, Inc. stock. Roots pays Bark a $400 dividend on August 1,

Accounting for equity investments

On January 1, 2024, Bark Company invests $10,000 in Roots, Inc. stock. Roots pays

Bark a $400 dividend on August 1, 2024. Bark sells the Roots stock on August 31,

2024, for $10,450. Assume the investment is categorized as a short-term equity investment

and Bark Company does not have significant influence over Roots, Inc.

Requirements

1. Journalize the transactions for Barks investment in Roots stock.

2. What was the net effect of the investment on Barks net income for the year ended

December 31, 2024?

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