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1. Prepare journal entries to record the preceding transactions and events for Selk.

3. Compute the net increase or decrease in Selks equity from January 5, 2017, through January 2, 2019, resulting from its investment in Kildaire.

Selk Steel Co, which began operations on January 4, 2017, had the following subsequent transactions and events in its long-term Investments. 2017 Jan. 5 Selk purchased 50,000 shares (25% of total) of Kildare's common stock for $1,100,000. Oct. 23 Kiidaire declared and paid a cash dividend of $6.00 per share. Dec. 31 kiidaire's net income for 2017 is $1,334,000, and the fair value of its stock at December 31 is 31-70 per share. 2018 Oet. 15 Kiidaire declared and paid a cash dividend of $3.80 per share. Dec. 31 Kildaire's net income for 2018 is $1,646,000, and the fair value of its stock at December 31 33.70 per share. 2019 Jan. 2 Selk sold all of its investment in Kildaire for $1,525,000 cash. Part 2 Assume that although Selk owns 25% of Kildaire's outstanding stock, circumstances indicate that it does not have a significant influence over the investee and that it is classified as an available-for-sale security investment Required: 1. Prepare journal entries to record the preceding transactions and events for Selk. Also prepare an entry dated January 2, 2019, to remove any balance related to the fair value adjustment. of no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Complete this question by entering your answers in the tabs below Answer is not complete. Complete this question by entering your answers in the tabs below. 2017 2018 2019 Prepare journal entries to record the preceding transactions and events for Selk. Also prepare an entry dated January 2, 2019, to remove any balance related to the fair value adjustment. No Dato General Journal Debit Credit Jan 02, 2019 Cash 1,525,000 Gain on sale of Investments 425,000 2 Jan 02, 2019 Unrealized gain-Equity 585,000 o Fair value adjustment-AFS (LT) 585,000 2018 2019 2. Compute the cost per share of Selk's investment in Kilidaire common stock as reflected in the investment account on January 1 2019. Answer is complete and correct S 22 3. Compute the net increase or decrease in Selk's equity from January 5, 201 in Kildaire through January 2, 2019, resulting from its investment 3 Answer is complete but not entirely correct. net increase s 425,000

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