On January 1, 2017, Culver Inc. paid $688,000 for 10,000 shares of Larkspur Company's voting common stock, which was a 10% interest in Larkspur. At that date, the net assets of Larkspur totaled $6,036,000. The fair values of all of Larkspur's identifiable assets and liabilities were equal to their book values. Culver does not have the ability to exercise significant influence over the operating and financial policies of Larkspur. Culver received dividends of $1.60 per share from Larkspur on October 1, 2017 Larkspur reported net income of $541,000 for the year ended December 31, 2017 On July 1, 2018, Culver paid $2,341,000 for 30,000 additional shares of Larkspur Company's voting common stock which represents a 30% investment in Larkspur. The fair values of all of Larkspur's identifiable assets net of liabilities were equal to their book values of $6,592,000. As a result of this transaction, Culver has the ability to exercise significant influence over the operating and financial policies of Larkspur. Culver received dividends of $2.20 per share from Larkspur on April 1, 2018, and $2.40 per share on October 1, 2018. Larkspur reported net income of $647,000 for the year ended December 31, 2018, and $351,000 for the 6 months ended December 31, 2018 (For both purchases, assume any excess of cost over book value is due to goodwil.) (a) Prepare a schedule showing the income or loss before income taxes for the year ended December 31, 2017, that Culver should report from its investment in Larkspur in its income statement issued in March 2018 CULVER INC. Schedule of Income or Loss from Investment (b) During March 2019, Culver issues comparative financial statements for 2017 and 2018. Prepare schedules showing the income or loss before income taxes for the years ended December 31, 2017 and 2018, that Culver should report from its investment in Larkspur CULVER INC. Schedule of Income or Loss from Investment 2018 2017 On January 1, 2017, Culver Inc. paid $688,000 for 10,000 shares of Larkspur Company's voting common stock, which was a 10% interest in Larkspur. At that date, the net assets of Larkspur totaled $6,036,000. The fair values of all of Larkspur's identifiable assets and liabilities were equal to their book values. Culver does not have the ability to exercise significant influence over the operating and financial policies of Larkspur. Culver received dividends of $1.60 per share from Larkspur on October 1, 2017 Larkspur reported net income of $541,000 for the year ended December 31, 2017 On July 1, 2018, Culver paid $2,341,000 for 30,000 additional shares of Larkspur Company's voting common stock which represents a 30% investment in Larkspur. The fair values of all of Larkspur's identifiable assets net of liabilities were equal to their book values of $6,592,000. As a result of this transaction, Culver has the ability to exercise significant influence over the operating and financial policies of Larkspur. Culver received dividends of $2.20 per share from Larkspur on April 1, 2018, and $2.40 per share on October 1, 2018. Larkspur reported net income of $647,000 for the year ended December 31, 2018, and $351,000 for the 6 months ended December 31, 2018 (For both purchases, assume any excess of cost over book value is due to goodwil.) (a) Prepare a schedule showing the income or loss before income taxes for the year ended December 31, 2017, that Culver should report from its investment in Larkspur in its income statement issued in March 2018 CULVER INC. Schedule of Income or Loss from Investment (b) During March 2019, Culver issues comparative financial statements for 2017 and 2018. Prepare schedules showing the income or loss before income taxes for the years ended December 31, 2017 and 2018, that Culver should report from its investment in Larkspur CULVER INC. Schedule of Income or Loss from Investment 2018 2017