On January 1, 2021, Wildhorse Company, a public company, purchased 40% of the common shares of Triple Titanium Inc. for $550,000. The remaining shares (60%) are held by the family members of the company's founder. Wildhorse considers this a strategic investment and a critical step into developing consumer markets. Triple Titanium is currently a supplier to Wildhorse. Wildhorse placed two members on the 10-person board of directors of Triple Titanium and the two members believe they have been influential on the board through the year. Wildhorse and Triple Titanium both have December 31 year ends. During 2021. Triple Titanium reported profit of $260,000 and paid total dividends of $60,000. - Your answer is partially correct. Prepare the following journal entries for Wildhorse, assuming significant influence does exist. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter for the amounts.) 1. The acquisition of the investment 2. Investment revenue and receipt of dividends related to the investment Debit Credit Date Account Titles and Explanation 2021 Investment in Associate 550000 550000 Cash (To record purchase of investment.) 2021 Cash 104000 104000 Investment in Associate (To record dividend received from associate.) 2021 Investment in Associate 24000 Income from Investment in Associate (To record investment income from associate.) - Your answer is partially correct. During 2022, Triple Titanium reports profit of $260,000 and pays total dividends of $70,000. Prepare the required journal entries related to these transactions on Wildhorse's books. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter for the amounts.) Debit Credit Date Account Titles and Explanation 2022 Cash 104000 104000 Investment in Associate (To record dividend received from associate.) 2022 Investment in Associate 28000 Income from Investment in Associate 28000 (To record investment income from associate.) e Textbook and Media - Your answer is partially correct. Determine the balance in the investment account on December 31, 2021, and December 31, 2022. 2021 2022 Ending balance $ 630000 $ 630000 Show how the investment account and related revenue accounts would be reported on the financial statements for December 31, 2021. WILDHORSE COMPANY Balance Sheet (Partial) December 31, 2021 Current Assets Investments at Fair value through Profit or Loss 630000 WILDHORSE COMPANY Income Statement (Partial) Year Ended December 31, 2021 Other Revenues Income from Investment in Associate 630000
