Basic accounting for stock investment On January 1, 19X4, Emerson Services purchased 8,000 common shares of Affiliated Enterprises for $8 per share. Information pertaining to Affiliated follows. Common stock outstanding ($1 par, 25,000 shares), Dec. 31, 1984 Net income, 1984 Dividends paid, 1984 $25,000 80,000 10,000 Affiliated's year-end market price was $7 per share. a. What method should Emerson use to account for its investment in Affiliated, why? b. Prepare the journal entries that Emerson would record in 1984 pertaining to the investment. c. Show how the investment would appear in the long-term investments section of the 19X4 year-end balance sheet