On January 1, 2020, Gilly Incorporated acquired 30% of the outstanding common shares of Tuna Company Ltd. The details of the acquisition and the earnings for Tuna are as follows: Tuna Co.

Carrying value of net assets as at January 1, 2020 $30,000,000

Acquisition price 9,000,000

Earnings for 2020 8,000,000

Dividends declared and paid for 2020 1,050,000

Assume that the net assets’ fair market value on January 1, 2020, was equal to their carrying amounts.

Prepare the journal entries that Gilly will make in 2020 to account for this investment assuming it uses the equity method.