On January 4. 2018, Runyan Bakery paid $352 million for 10 million shares of Lavery Labeling Company common stock. The investment represents a 30 % interest in the net assets of Lavery and gave Runyan the ability to exercise significant influence over Lavery's operations. Runyan chose the fair value option to account for this investment. Runyan received dividends of $2.00 per share on December 15, 2018, and Lavery reported net income of $290 million for the year ended December 31, 2018.. The market value of Lavery's common stock at December 31, 2018, was $34 per share. On the purchase date, the book value of Lavery's net assets was $940 million and: a. The fair value of Lavery's depreciable assets, with an average remaining useful life of 9 years, exceeded their book value by $90 million. b. The remainder of the excess of the cost of the investment over the book value of net asse purchased was attributable to goodwill. Required: 1-a. Prepare all appropriate journal entries related to the investment during 2018, assuming Runyan accounts for this investment under the fair value option, and acccounts for the Lavery investment in a manner similar to what it would use for securities for which there is not significant influence. 1-b. Calculate the effect of these journal entries on 2018 net income, and the amount at which the investment is carried in the December 31, 2018, balance sheet. 2-a. Prepare all appropriate journal entries related to the investment during 2018, assuming Runyan accounts for this investment under the fair value option, but uses equity method accounting to account for Lavery's income and dividends, and then records a fair value adjustment at the end of the year that allows it to comply with GAAP 2-b. Calculate the effect of these journal entries on 2018 net income, and the amount at which the investment is carried in the December 31, 2018, balance sheet. Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 2A Req 2B Prepare all appropriate journal entries related to the investment during 2018, assu ming Runyan accounts for this investment under the fair value option, and accou nts for the Lavery investment in a manner similar to what it would use for securities for which there is not significant influence. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) Show less View transaction list View journal entry worksheet Debit Credit 1 Record the purchase of Lavery Labeling stock for $352. million. Record Runyan Bakery's share of Lavery's $290 million net income. 3 Record the receipt of cash dividends of $2.00 per share on 10 million shares. Record any necessary entry related to depreciation. The fair value of Lavery's depreciable assets, with an average Req 1B> remaining useful life of six years, exceeded their book value by $90 million. Record any necessary adjusting entry to correctly report the investment on the balance sheet. The market value 5 =journal entry has been entered Note Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 2A Req 2B Calculate the effect of these journal entries on 2018 net income, and the amount at which the investment is carried in the December 31, 2018, balance sheet. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) Effect on net income Investment million million Req 1A Req 2A Req 2A Req 1A Req 1B Req 2B Prepare all appropriate journal entries related to the investment during 2018, assuming Runyan accounts for this investment under the fair value option, but uses equity method accounting to account for Lavery's income and dividends, and then records a fair value adjustment at the end of the year that allows it to comply with GAAP. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) Show less View transaction list X: Record the purchase of Lavery Labeling stock for $352 1 million. 2 Record Runyan Bakery's share of Lavery's $290 million net income. Record the receipt of cash dividends of $2.00 per share on 10 million shares. 3 Credit Record any necessary entry related to depreciation. The fair value of Lavery's depreciable assets, with an average remaining useful life of six years, exceeded their book value by $90 million. 4 Record any necessary adjusting entry to correctly report the investment on the balance sheet. The market value journal entry has been entered Note Record entry Clear entry View general journal x Req 2A Req 2B Req 1A Reg 1B Calculate the effect of these journal entries on 2018 net income, and the amount at which the investment is carried in the December 31, 2018, balance sheet. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) million million Net income Investment Req 2A Req 2B