Felicia Company acquired some of the 55,000 shares of outstanding common stock (no par) of Nueces Corporation during 2010 as a long-term investment. The annual accounting period for both companies ends December 31. The following transactions occurred during 2010:

Jan. 10	Purchased 17,600 shares of Nueces common stock at $13.1 per share.
Dec. 31	a.	Received the 2010 financial statements of Nueces Corporation that reported net income of $91,000.
	b.	Nueces Corporation declared and paid a cash dividend of $.66 per share.
	c.	Determined the market price of Nueces stock to be $11 per share.

Requirement 1:

What accounting method should the company use?

Requirement 2:

Prepare the journal entries for each of these transactions.

Requirement 3:

Show how the long-term investment and the related revenue should be reported in the 2010 financial statements of the company. (Round your answers to the nearest dollar amount.)