Recording Entries for Equity Investment: FV$-$NI and Equity Method

On January $1,$ Allen Corporation purchased $30\%$ of the $18,000$ outstanding common shares of Towne Corporation at $$17$ 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 $$14,400$ and declared and paid dividends of $$4,800.$ As of December $31,$ common shares of

Towne Corporation were trading at $$20$ per share.

c$.$ Indicate the amount of income that would be reported on the income statement and the investment balance on the year$-$end balance

sheet under requirement $($a$)$ and requirement $($b$).$