On January 2, 2018, Sanborn Tobacco Inc. bought 5% of Jackson Industrys capital stock for $94 million. Jackson Industrys net income for the year ended December 31, 2018, was $124 million. The fair value of the shares held by Sanborn was $106 million at December 31, 2018. During 2018, Jackson declared a dividend of $64 million. Required: 1. Prepare all appropriate journal entries related to the investment during 2018. 2. Assume that Sanborn sold the stock on January 2, 2019 for $118 million. Prepare the journal entries Sanborn would use to record the sale.

Journal entry worksheet 4 Record the purchase of Jackson Industry capital stock for $94. Note: Enter debits before credits. Event General Journal Debit Credit Record entry Clear entry View general journal Journal entry worksheet 2 Record the entry to adjust to fair value on the date of sale Note: Enter debits before credits. Event General Journal Debit Credit 2 Record entry Clear entry View general journal