On January 1, 2016, XYZ Company purchased shares of the stock of Rayco, and did obtain significant influence. The investment is intended as a long-term investment. The stock was purchased for $90,000, and represents a 30% ownership stake. Rayco made $25,000 of net income in 2014, and paid dividends of $10,000.

Prepare the January 1 and December 31 general journal entries for XYZ Company.

How much should the XYZ Company report on the balance sheet for the investment in Rayco at the end of 2016?