Equity Method for Stock Investment with Loss On January 6, Year 1, Bulldog Co. purchased 26% of the outstanding stock of Gator Co. for $153,000. Gator Co. paid total dividends of $16,800 to all shareholders on June 30. Gator Co. had a net loss of $29,100 Year 1. a. Journalize Bulldog's purchase of the stock, receipt of the dividends, and the adjusting entry for the equity loss in Gator Co. stock. Jan. 6 - Purchase June 30 - Dividend Dec. 31 - Equity Loss b. Compute the balance of Investment in Gator Co. Stock on December 31, Year 1. c. How does valuing an investment under the equity method differ from valuing an investment at fair value? Under the method, the investor will record their proportionate share of the net increase or decrease) of the book value of the investee resulting from earnings and dividend distributions. The method uses market price information to value the investment in the investee. equity fair value