Jaycie Phelps Inc. acquired $20\%$ of the outstanding common stock of Theresa Kulikowski Inc. on December $31,2020.$ The purchase price was $$1,200,000$ for $50,000$ shares. Kulikowski Inc. declared and paid an $$0\mathrm{.}85$ per share cash dividend on June $30$ and on December $31,2021.$ Kulikowski reported net income of $$730,000$ for $2021.$ The fair value of Kulikowski's stock was $$27$ per share at December $31,2021.$

$($a$)$

Prepare the journal entries for Jaycie Phelps Inc. for $2020$ and $2021,$ assuming that Phelps can exercise significant influence over Kulikowski. $($Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select $"$No Entry" for the account titles and enter $0$ for the amounts.$)$

Date

Account Titles and Explanation

Debit

Credit

At what amount is the investment in securities reported on the balance sheet under each of these methods at December $31,2021?$ What is the total net income reported in $2021$ under each of these methods?

Investment amount $($balance sheet$)$

Dividend revenue $($income statement$)$

Unrealized holding gain $($income statement$)$

Investment income $($income statement$)$

Prepare the journal entries for Jaycie Phelps Inc. for $2020$ and $2021,$ assuming that Phelps cannot exercise significant influence over Kulikowski.