Ravine Corporation purchased 30 percent ownership of Valley Industries for $89,400 on January 1, 20X6, when Valley had capital stock of $245,000 and retained earnings of $53,000. During the period of January 1, 20X6, through December 31, 20X9, the market value of Ravine's Investment in Valley's stock Increased by $11,000 each year. The following data were reported by the companies for the years 20X6 through 20X9: Operating Income, Net Income, Year Ravine Corporation Valley Industries 20X6 $ 36,000 20X7 $ 150,000 99,000 230,000 170,000 56,000 10,000 46,000 20x8 20X9 Required: a. What net income would Ravine Corporation have reported for each of the years, assuming Ravine accounts for the intercorporate Investment either by carrying the investment at fair value, or by using the equity method? b-1. Give all appropriate Journal entries for 20X8 that Ravine would make if it carries the Investment at fair value. b-2. Give all appropriate Journal entries for 20X8 that Ravine would make if it uses the equity method. Required A Required B1 Required B2 Complete this question by entering your answers in the tabs below. Dividends Declared Ravine $ 90,000 90,000 110,000 120,000 Year 20X6 20X7 What net income would Ravine Corporation have reported for each of the years, assuming Ravine accounts for the intercorporate investment either by carrying the investment at fair value, or by using the equity method? 20X8 20X9 Valley $ 26,000 46,000 40,000 26,000 Net Income Fair Value Equity Method

Ravine Corporation purchased 30 percent ownership of Valley Industries for $89,400 on January 1, 20x6, when Valley had capital stock of $245,000 and retained earnings of $53,000. Durnng the period of January 1, 20X6, through December 31,209, the market value of Ravine's investment in Valley's stock Increased by $11,000 each year. The following data were reported by the companies for the years 206 through 209. Required: o. What net income would Ravine Corporation have reported for each of the years, assuming Ravine accounts for the intercorporate investment elther by carrying the investment at fali value, or by using the equity method? b-1. Give all appropriate journal entries for 208 that Ravine would make if it carries the investment at fair value: b-2. Give all appropriate joumal entries for 208 that Ravine would make if it uses the equity method Complete this question by entering your answers in the tabs below. What net income would Ravine Corporation have reported for each of the years, assumino Ravine accounts for the intercorporate investment either by carrying the investment at fair value, or by using the equity method? Give all appropriate journal entries for 208 that Ravine would make if it uses the equity method. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Journal entry worksheet Record the dividend received from Valley Industries under the equity method. Note: Enter debits before credits. Give all appropriate joumal entries for 208 that Ravine would make if it carries the investment at fair value. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Journal entry worksheet Record the dividend received from valley Industries under the fair value method. Notei Enter debs before credits. Give all appropriate journal entries for 208 that Ravine would make if it carries the investrnent at fair value. Note: If no entry is required for a transaction/event, seiect "No joumal entry required" in the first account field. Journal entry worksheet Record the unrealized gain from valley Industries under the fair value method. Notes Enter debata belore credata. Give all appropriate journal entries for 208 that Ravine would make if it uses the equity method. Note; If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Journal entry worksheet Record the share-in net income of Valley Industries under the equity method. Noter Enter debits before credits