On January 2, 2019, Magee, Inc., purchased, as a stock investment, 20,000 shares of Dye, lnc.'s common stock for $21 per share, including commissions and taxes. On December 31, 2019, Dye announced a net income of $280,000 for the year and declared a dividend of 80 cents per share, payable January 15, 2020, to stockholders of record on January 5, 2020. At December 31, 2019, the market value of Dye's stock was $18 per share. Magee received its dividend on January 18, 2020.

REQUIRED:

a. Assume that the stock acquired by Magee represents 10% of Dye's voting stock and is classified in the trading category. Prepare all journal entries appropriate for this investment, beginning with the purchase on January 2, 2019, and ending with the receipt of the dividend on January 18, 2020. (Magee recognizes dividend income when received.)

b. Post the journal entries from part a to their respective T-accounts.

c. Record each of the transactions from part a in the financial statement effects template.

d. Assume that the stock acquired by Magee represents 40% of Dye's voting stock. Prepare all journal entries appropriate for this investment, beginning with the purchase on January 2, 2019, and ending with the receipt of the dividend on January 18, 2020.

e. Post the journal entries from part d to their respective T-accounts.

f. Record each of the transactions from part din the financial statement effects template.