Roller Corporation purchased 20 percent ownership of Steam Company on January 1, 20X5, for $70,000. On that date, the book value of Steam's reported net assets was $200,000. The excess over book value paid is attributable to depreciable assets with a remaining useful life of 10 years. Net income and dividend payments of Steam in the following periods were:

Required 

Prepare journal entries on Roller Corporation's books relating to its investment in Steam Company for each of the three years, assuming it accounts for the investment using (a) the cost method and (b) the equity method.

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Winston Corporation Year Operating Income Dividends 20X2 20X3 20X4 $100,000 60,000 250,000 $ 40,000 80,000 120,000 Fullbright Company Net Income $70,000 40,000 25,000 Dividends $30,000 60,000 50,000