The following transactions involve investments in marketable securities and are accounted for using the equity method.

(1) Healy Co. purchases 15,000 common shares of Palepu Co. at $8 cash per share; the shares represent 25% ownership of Palepu.

(2) Healy receives a cash dividend of $0.80 per common share from Palepu.

(3) Palepu reports annual net income of $120,000.

(4) Healy sells all 15,000 common shares of Palepu for $140,000 cash.

a. Prepare journal entries to record these four transactions.

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

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