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Solve the following unrelated short problems: a. Lee, Inc. acquired 30% of Polk Corp.'s voting stock on January 1, 2017 for $100,000. Lee's investment in
Solve the following unrelated short problems: a. Lee, Inc. acquired 30% of Polk Corp.'s voting stock on January 1, 2017 for $100,000. Lee's investment in Polk gives Lee the ability to exercise significant influence over Polk's operating and financial policies. During 2017, Polk earned $40,000 of net income and paid dividends of $25,000 to its shareholders. The fair market value of Lee's investment in Polk at December 31, 2017 is $110,000. Required Prepare all 2017 journal entries for Lee related to this investment in Polk. b. On July 1, 2017, Denver Corp. purchased 3,000 shares of Eagle Co.'s 18,000 outstanding shares of common stock for $20 per share. During 2017, Eagle paid $40,000 in dividends to its common stockholders. Eagle's net income for the year ended December 31, 2017 was $120,000. Eagle's common shares were trading at $25 per share at December 31, 2017. Required Prepare all 2017 journal entries for Denver related to this investment in Eagle
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