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**Just need assistance with sections in RED** Exercise 17-16 whispering Inc. acquired 20% of the outstanding common stock of Theresa Kulikowski Inc. on December 31,
**Just need assistance with sections in RED**
Exercise 17-16 whispering Inc. acquired 20% of the outstanding common stock of Theresa Kulikowski Inc. on December 31, 2017. The purchase price was $1,214,400 for 52,800 shares. Kulikowski Inc. declared and paid an $0.80 per share cash dividend on June 30 and on December 31, 2018. Kulikowski reported net income of $768,000 for 2018. The fair value of Kulikowski's stock was $26 per share at December 31, 2018. Assume that the security is a trading security Your answer is correct. Prepare the journal entries for Whispering Inc. for 2017 and 2018, assuming that Whispering cannot 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 Dec. 31, 2017Equity Investments 1,214,400 Cash 1,214,400 June 30, 2018 Cash 42240 Dividend Revenue 42240 Dec. 31, 2018 Cash 42240 Dividend Revenue 42240 (To record dividend.) Fair Value Adjustment 158400 Unrealized Holding Gain or Loss - Income 158400 (To record fair value.)Step by Step Solution
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