Clark Company acquired 15% of the 500,000 shares of common stock of Davis Company at a total cost of $25.75 per share on June 1, 2025. On October 1, Davis Company declared and paid a $50,000 cash dividend. On December 31, Davis Company stock had a market price of $27.00 per share and the company reported net income of $1,250,000 for the year. The securities are classified as trading.

Prepare all journal entries for 2025.

June 1

Oct 1

Dec 31

Use the information above: Assume Clark Company acquired 40% of the shares of Davis Company.

June 1

Oct 1

Dec 31