On May 1, 2023, Xiao Company, a public company, acquired 211,120 of the 728,000 outstanding common shares from Zahra Company for a total of $1,504,000. This investment is part of Xiao Company’s long-term business diversification plan. Xiao Company’s year-end is December 31. During 2023, the following investment activities occurred.

1) Zahra Company recorded an annual net income of $844,000 for its 2022–2023 fiscal year-end of June 30, 2023.
2) Zahra Company paid a cash dividend of $208,000 on July 30, 2023.

Required
Prepare journal entries to record the acquisition of shares by Xiao Company, the revenue of investment from Zahra Company on June 30, 2023 and the receipt of cash dividends on July 30, 2023.

Round all answers to the nearest whole number.

Answer rating: 100% (QA)

May 1 2023 Dr Investment in associate 1504000 Cr Cash 1504... View the full answer