Recording Entries for Equity Investment: Equity Method On January 1, Allen Corporation purchased 30% of the 15,000 outstanding common shares of Towne Corporation at $15 per share as a long-term investment. On the date of purchase, the book value and the fair value of the net assets of Towne Corporation were equal. During the year, Towne Corporation reported net income of $12,000. Towne Corporation declared and paid cash dividends of $4,000 on December 30, to shareholders on record. As of December 31, common shares of Towne Corporation were trading at $20 per share. a. Record the entries during the year assuming that Allen Corporation had significant influence over Towne Corporation. Date Account Name Dr. Cr. Jan. 1 0 To record investment purchase. Dec 30 To record receipt of dividends. Dec. 31 0 0 To record proportionate share of investee's net income. b. Indicate the effects of this investment on the income statement and year-end balance sheet. Note: Use a negative sign to indicate a loss Income Statement Other Revenues 0 Balance Sheet, December 31 Assets 0 Please answer all parts of the question Record the entries during the year assuming that Allen Date Lan. 1 Cash Account Name Dr. 0 0 Dec. 3 Dec. 3 Interest Receivable Investment in TS Fair Value Adjustment--TS Investment in AFS Securities Fair Value Adjustment--AFS Investment in HTM Securities Investment in Stock Fair Value Adjustment--Equity Securities Fair Value Adjustment--Fair Value Option Allowance for Credit Losses Accumulated Other Comprehensive Income Unrealized Gain or Loss--OCI 0 0 0 0 atement and year- b. Indi Note: Unrealized Gain or Loss--Income Dividend Revenue Other Interest Revenue Investment Income Loss on Impairment Recovery of Loss on Impairment Assets Loss on Sale of Investment Gain on Sale of Investment N/A Please