Instructions:

1-4 Use one page for each question. You MUST show ALL calculations on the answer sheet to receive full credit. Do NOT abbreviate account titles. Do NOT abbreviate dollar amounts (e.g., 200k).

1. Investment in Equity Securities

On January 1, 2021, Topeka Company purchased 90,000 shares of Washington Companys $5 par common stock for $40 per share. During 2021, Washington paid total dividends of $500,000 and reported net income of $800,000. Washington stock was trading for $41 per share on December 31, 2021. During 2022, Washington paid total dividends of $100,000 and reported net loss of $200,000. Washington stock was trading for $38 per share on December 31, 2022.

Instructions:

1. Prepare all necessary journal entries for 2021 and 2022 if Washington has 900,000 shares of common stock outstanding.
2. Prepare all necessary journal entries for 2021 and 2022 if Washington has 225,000 shares of common stock outstanding

show calculations