Roller Corporation purchased 100 percent ownership of Steam Company on January 1, 20X5, for $288,000. On that date, the book value of Steams reported net assets was $211,000. The excess over book value paid is attributable to depreciable assets with a remaining useful life of 10 years. Net income and dividend payments of Steam in the following periods were

Year		Net Income			Dividends
20X5		$	25,000		$	6,000
20X6			45,000			16,000
20X7			25,000			37,000

Required:

a.

Prepare journal entries on Roller Corporations books relating to its investment in Steam Company for each of the three years, assuming it accounts for the investment using the cost method. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

b.

Prepare journal entries on Roller Corporations books relating to its investment in Steam Company for each of the three years, assuming it accounts for the investment using the equity-method. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

*Record the purchase of Steam Company stock for 20X5.

*Record the dividend from Steam Company for 20X5.

*Record the equity-method income for 20X5.

*Record the amortization of differential value for 20X5.

*Record the dividend from Steam Company for 20X6.

*Record the equity-method income for 20X6.

*Record the amortization of the differential value for 20X6.

*Record the dividend from Steam Company for 20X7.

*Record the equity-method income for 20X7.

*Record the amortization of the differential value for 20X7.