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On January 1, Landcaster Incorporated acquired 33% of the outstanding voting shares of Shadrach Company at a cost of $1,758, by acquiring 85,800 of

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On January 1, Landcaster Incorporated acquired 33% of the outstanding voting shares of Shadrach Company at a cost of $1,758, by acquiring 85,800 of the total 260,000 outstanding shares at a cost of $20.50 per share. Landcaster elected the fair value option During the year, Shadrach reported $1,240,000 in net income and declared and paid $1.18 per share dividends. At the end of the the fair value of the investment is $1,676,900. Requirements a. Prepare the journal entry to record the acquisition of the investment securities. b. Prepare the journal entries at year-end to record the fair value adjustment at the end of the year of acquisition. c. Prepare the journal entry to record the sale of 70% of the Shadrach common shares for $1,678,000 on January 1 of the year following the acquisition. Requirement a. Prepare the journal entry to record the acquisition of the investment securities (Record debits first, then credits. Exclude explanations from any journal entries.) Account Equity Investment in Shadrach Company January 1, Current Year 1758900 Cash 1758900 Requirement b. Prepare the journal entries at year-end to record the fair value adjustment at the end of the year of acquisition. (Record debits first, then credits. Exclude explanations from any journal entries If no entry is required select "No Entry Required" on the first line of the journal entry table and leave all remaining cells in the table blank) Account Unrealized Gain/Loss on Equity Investment-Fair Value Option (OCI) Unrealized Gain/Loss on Equity Investment-Fair Value Option (OCI) December 31, Current Year Requirement c. Prepare the journal entry to record the sale of 70% of the Shadrach common shares for $1,678,000 on January 1 of the year following the acquisition. (Record debits first, then credits. Exclude explanations from any journal entries.)

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