YZA Inc. purchased 32 percent of BCD Ltd.'s voting stock on January 1, 2017, for £5.5 million in cash. At the date of acquisition, BCD reported its total assets at £85 million and its total liabilities at £78 million. Investigation revealed that BCD's buildings (25-year life) were overvalued by £3.2 million and it had an unreported franchise (10-year life) valued at £900,000. BCD declares and pays £160,000 in dividends and reports net income of £310,000 in 2023.

Required: Prepare the necessary journal entries on YZA's books to report the above information for 2023 assuming YZA uses the equity method to report its investment.