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On January 1, 20X0, Pepper Corporation issued 9,000 of its $10 par value shares to acquire 45 percent of the shares of Salt Manufacturing. Salt Manufacturing's balance sheet immediately before the acquisition contained the following items' On the date of the stock acquisition, Pepper's shares were selling at $35, and Salt Manufacturing's buildings and equipment had a remaining economic life of 5 years. The amount of the differential assigned to goodwill is not impaired. In the two years following the stock acquisition, Salt Manufacturing reported net income of $88,000 and $58,000 and paid dividends of $29,000 and $48,000, respectively. Pepper used the equity method in accounting for its ownership of Salt Manufacturing. b-2. Prepare the journal entries recorded by Pepper during 201 related to its Investment In Salt Manufacturing. Note: If no entry is required for a transaction/event, select "No Journal entry required" In the flrst account fleld. A Record the dividends received from Salt Manufacturing. B Record the equity-method income for period. c Record the entry to amortize the differential assigned to buildings and equipment. Note : journal entry has been entered c. What balance will be reported in Pepper's investment account on December 31,201

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