Question 1A & B

2A&B

In the pictures It does show you the answers I have put into Connect and what it has said is right and wrong. Please make sure that your answers match up to the correct ones on here. if they don't then please don't post your answer please. Also for question 2A&B please make sure that you do 5 journal entries.

00 On January 4, 2021, Runyan Bakery paid $330 million for 10 million shares of Lavery Labeling Company common stock. The investment represents a 30% interest in the net assets of Lavery and gave Runyan the ability to exercise significant influence over Lavery's operations. Runyan chose the fair value option to account for this investment. Runyan received dividends of $3 per share on December 15, 2021, and Lavery reported net income of $180 million for the year ended December 31, 2021. The market value of Lavery's common stock at December 31, 2021, was $31 per share. On the purchase date, the book value of Lavery's identifiable net assets was $830 million and: 3 points eBook a. The fair value of Lavery's depreciable assets, with an average remaining useful life of seven years, exceeded their book value by $70 million. b. The remainder of the excess of the cost of the investment over the book value of net assets purchased was attributable to goodwill. Print References Required: 1-a. Prepare all appropriate journal entries related to the investment during 2021, assuming Runyan accounts for this investment under the fair value option, and accounts for the Lavery investment in a manner similar to what it would use for securities for which there is not significant influence. 1-b. Calculate the effect of these journal entries on 2021 net income, and the amount at which the investment is carried in the December 31, 2021, balance sheet. 2-a. Prepare all appropriate journal entries related to the investment during 2021, assuming Runyan accounts for this investment under the fair value option, but uses equity method accounting to account for Lavery's income and dividends, and then records a fair value adjustment at the end of the year that allows it to comply with GAAP. 2-b. Calculate the effect of these journal entries on 2021 net income, and the amount at which the investment is carried in the December 31, 2021, balance sheet. (Note: You should end up with the same total 2021 income effect and same carrying value on the balance sheet for requirements 1 and 2.) X Req 1A Reg 1B Reg 2A Req 2B 1 Record the purchase of Lavery Labeling stock for $330 million. Prepare all appropriate journal entries related to the investment during 2021, assuming Runyan accounts for this investment under the fair value option, and accounts for the Lavery investment in a manner similar to what it would use for securities for which there is not significant influence. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) Show less No Transaction Debit Credit 2 Record Runyan Bakery's share of Lavery's $180 million net income. 1 1 General Journal Investment in equity securities Cash 330,000,000 330,000,000 Record the receipt of cash dividends of $3 per share on 10 million shares. 2 2 X 54,000,000 Investment in equity securities Investment revenue x 54,000,000 X 3 3 30,000,000 X Cash Investment in equity securities x 4 Record any necessary adjusting entry to correctly report the investment on the balance sheet. The market value of Lavery's common stock at December 31, 2021 was $31 per share. 30,000,000 X 4 4 20,000,000 X Loss on investment (unrealized, NI) Fair value adjustment 20,000,000 X Note = journal entry has been entered Reg 1A Reg 1B Reg 2A Reg 2B Calculate the effect of these journal entries on 2021 net income, and the amount at which the investment is carried in the December 31, 2021, balance sheet. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) Effect on net income Investment $ $ 10 million 310 million X 1 Record the purchase of Lavery Labeling stock for $330 million. Prepare all appropriate journal entries related to the investment during 2021, assuming Runyan accounts for this investment under the fair value option, but uses equity method accounting to account for Lavery's income and dividends, and then records a fair value adjustment at the end of the year that allows it to comply with GAAP. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) Show less No Transaction General Journal Debit Credit 1 1 Investment in equity affiliate 330,000,000 Cash 330,000,000 X 2 Record Runyan Bakery's share of Lavery's $180 million net income. OOOO 3 Record the receipt of cash dividends of $3 per share on 10 million shares. 2 2 54,000,000 & Investment in equity affiliate Investment revenue 54,000,000 X 3 3 Cash 30.000.000 X Record any necessary entry related to depreciation. The fair value of Lavery's depreciable assets, with an average remaining useful life of seven years, exceeded their book value by $ 70 million. Investment in equity affiliate 30,000,000 4 4 3,000,000 Investment revenue Investment in equity affiliate OO 3,000,000 X 5 Record any necessary adjusting entry to correctly report the investment on the balance sheet. The market value of Lavery's common stock at December 31, 2021 was $31 per share. 5 5 No journal entry required X Note : = journal entry has been entered Reg 1A Req 1B Reg 2A Reg 2B Calculate the effect of these journal entries on 2021 net income, and the amount at which the investment is carried in the December 31, 2021, balance sheet. (Note: You should end up with the same total 2021 income effect and same carrying value on the balance sheet for requirements 1 and 2.) (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) Show less $ Net income Investment 10 million 310 million $ $ 00 On January 4, 2021, Runyan Bakery paid $330 million for 10 million shares of Lavery Labeling Company common stock. The investment represents a 30% interest in the net assets of Lavery and gave Runyan the ability to exercise significant influence over Lavery's operations. Runyan chose the fair value option to account for this investment. Runyan received dividends of $3 per share on December 15, 2021, and Lavery reported net income of $180 million for the year ended December 31, 2021. The market value of Lavery's common stock at December 31, 2021, was $31 per share. On the purchase date, the book value of Lavery's identifiable net assets was $830 million and: 3 points eBook a. The fair value of Lavery's depreciable assets, with an average remaining useful life of seven years, exceeded their book value by $70 million. b. The remainder of the excess of the cost of the investment over the book value of net assets purchased was attributable to goodwill. Print References Required: 1-a. Prepare all appropriate journal entries related to the investment during 2021, assuming Runyan accounts for this investment under the fair value option, and accounts for the Lavery investment in a manner similar to what it would use for securities for which there is not significant influence. 1-b. Calculate the effect of these journal entries on 2021 net income, and the amount at which the investment is carried in the December 31, 2021, balance sheet. 2-a. Prepare all appropriate journal entries related to the investment during 2021, assuming Runyan accounts for this investment under the fair value option, but uses equity method accounting to account for Lavery's income and dividends, and then records a fair value adjustment at the end of the year that allows it to comply with GAAP. 2-b. Calculate the effect of these journal entries on 2021 net income, and the amount at which the investment is carried in the December 31, 2021, balance sheet. (Note: You should end up with the same total 2021 income effect and same carrying value on the balance sheet for requirements 1 and 2.) X Req 1A Reg 1B Reg 2A Req 2B 1 Record the purchase of Lavery Labeling stock for $330 million. Prepare all appropriate journal entries related to the investment during 2021, assuming Runyan accounts for this investment under the fair value option, and accounts for the Lavery investment in a manner similar to what it would use for securities for which there is not significant influence. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) Show less No Transaction Debit Credit 2 Record Runyan Bakery's share of Lavery's $180 million net income. 1 1 General Journal Investment in equity securities Cash 330,000,000 330,000,000 Record the receipt of cash dividends of $3 per share on 10 million shares. 2 2 X 54,000,000 Investment in equity securities Investment revenue x 54,000,000 X 3 3 30,000,000 X Cash Investment in equity securities x 4 Record any necessary adjusting entry to correctly report the investment on the balance sheet. The market value of Lavery's common stock at December 31, 2021 was $31 per share. 30,000,000 X 4 4 20,000,000 X Loss on investment (unrealized, NI) Fair value adjustment 20,000,000 X Note = journal entry has been entered Reg 1A Reg 1B Reg 2A Reg 2B Calculate the effect of these journal entries on 2021 net income, and the amount at which the investment is carried in the December 31, 2021, balance sheet. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) Effect on net income Investment $ $ 10 million 310 million X 1 Record the purchase of Lavery Labeling stock for $330 million. Prepare all appropriate journal entries related to the investment during 2021, assuming Runyan accounts for this investment under the fair value option, but uses equity method accounting to account for Lavery's income and dividends, and then records a fair value adjustment at the end of the year that allows it to comply with GAAP. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) Show less No Transaction General Journal Debit Credit 1 1 Investment in equity affiliate 330,000,000 Cash 330,000,000 X 2 Record Runyan Bakery's share of Lavery's $180 million net income. OOOO 3 Record the receipt of cash dividends of $3 per share on 10 million shares. 2 2 54,000,000 & Investment in equity affiliate Investment revenue 54,000,000 X 3 3 Cash 30.000.000 X Record any necessary entry related to depreciation. The fair value of Lavery's depreciable assets, with an average remaining useful life of seven years, exceeded their book value by $ 70 million. Investment in equity affiliate 30,000,000 4 4 3,000,000 Investment revenue Investment in equity affiliate OO 3,000,000 X 5 Record any necessary adjusting entry to correctly report the investment on the balance sheet. The market value of Lavery's common stock at December 31, 2021 was $31 per share. 5 5 No journal entry required X Note : = journal entry has been entered Reg 1A Req 1B Reg 2A Reg 2B Calculate the effect of these journal entries on 2021 net income, and the amount at which the investment is carried in the December 31, 2021, balance sheet. (Note: You should end up with the same total 2021 income effect and same carrying value on the balance sheet for requirements 1 and 2.) (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) Show less $ Net income Investment 10 million 310 million $ $