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Problem 12-12 Fair value option; equity method investments [L012-5, 12-6, 12-7, 12-8] On January 4, 2018, Runyan Bakery paid $326 million for 10 million shares

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Problem 12-12 Fair value option; equity method investments [L012-5, 12-6, 12-7, 12-8] On January 4, 2018, Runyan Bakery paid $326 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 $4 per share on December 15, 2018, and Lavery reported net income of $160 million for the year ended December 31, 2018. The market value of Lavery's common stock at December 31, 2018, was $30 per share. On the purchase date, the book value of Lavery's net assets was $810 million and: a. The fair value of Lavery's depreciable assets, with an average remaining useful life of [a(27) years, exceeded their book value by $40 million b. The remainder of the excess of the cost of the investment over the book value of net assets purchased was attributable to goodwill. 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 No Event General Journal Debit Credit 1Investment in Lavery Labeling shares 326 Cash 326 2 Investment in Lavery Labeling shares Investment revenue 48 48 Cash 35 Investment in Lavery Labeling shares 35 Investment revenue Investment in Lavery Labeling shares Unrealized holding loss-NI Fair value adjustment Please provide the numbers for the debit and credit of the fourth and fifth journal entry and show work. Thank you

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