Problem 1

The summarized balance sheets of Goebel Company and Dobbs Company as of December 31, 2021, are as follows:

Goebel Company

Balance Sheet

December 31, 2021

Assets$2,400,000

Liabilities$300,000

Capital stock1,200,000

Retained earnings900,000

Total equities$2,400,000

Dobbs Company

Balance Sheet

December 31, 2021

Assets$1,800,000

Liabilities$410,000

Capital stock1,150,000

Retained earnings240,000

Total equities$1,800,000

If Goebel Company acquired a 20% interest in Dobbs Company on December 31, 2021, for $350,000 and the fair value method of accounting for the investment was used, the amount of the debit to Equity Investments (Dobbs) would have been _____.

If Goebel Company acquired a 30% interest in Dobbs Company on December 31, 2021, for $430,000 and the equity method of accounting for the investment was used, the amount of the debit to Equity Investments (Dobbs) would have been

If Goebel Company acquired a 20% interest in Dobbs Company on December 31, 2021, for $290,000 and during 2022 Dobbs Company had net income of $150,000 and paid a cash dividend of $60,000, applying the fair value method would give a debit balance in the Equity Investments (Dobbs) account at the end of 2022

If Goebel Company acquired a 30% interest in Dobbs Company on December 31, 2021, for $440,000 and during 2022 Dobbs Company had net income of $150,000 and paid a cash dividend of $60,000, applying the equity method would give a debit balance in the Equity Investments (Dobbs) account at the end of 2022 of

Please Explain how you arrived to answer. Thank you in advance