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Fart 2-5 questions, a total of 50 points In any question calling for computations, partial...

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Accounting

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Fart 2-5 questions, a total of 50 points In any question calling for computations, partial credit may be available if you show your work. Question 1 Methods for accounting for investments in other companies ( 9 points) Able Company has purchased 10,000 shares of stock of Baker Company. This represents 20% ownership. What journal entry, if any would Able make in the following situations: A. Baker declares and immediately pays a dividend of $1 per share. Assume Able uses the fair value method of accounting for its investment? (3 points) B. What would be the journal entry be for the situation described in part A if Able uses the equity method of accounting for its investment? ( 3 points) C. Able learns that Baker earned a profit of $10 million. Assume Able uses the fair value method of accounting for its investment. ( 3 points)

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