Franklin purchases 25 percent of Johnson Company on January 1 for $500,000. This acquisition gave Franklin the ability to significantly influence Johnson's operating and financing policies. Johnson reports assets on that date of $1,400,000 with liabilities of $500,000. One building with a 7-year remaining life is undervalued on Johnson's books by $140,000. Also Johnson's book value for its trademark (10-year remaining life) is undervalued by $210,000. During the year, Johnson reports net income of $90,000 while declaring dividends of $30,000. Book Required: Prepare all the journal entries for Franklin. a. When acquired: Jan 1 Investment (ash 500,000 500,000 b. Share of income: Investment 23.500 (25% X90,000) Incom 22.500 c. Share of Dividend: Cash 7500 7500 Investment d. Amortization of excess: Income Investment e. Based on a purchase price of $500,000 what is Franklin's internal assignment to Goodwill? Goodwill purchase price 500,000 3121500 187,500 140,000+10,000 Book + Understan Fair valve Asset 1,400,000 + 350,000 = 1,750,000 liab 900,000 25% 125,000 (500,000) 500,000 1,250,000 X25% 312,500