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Unformatted text preview: E2-4 Cost versus Equity ReportingDifferential = $70,000 – 20%(200,000) = 30,000Net assets 30,000 / 10yrs = $3,000 per yr. a. Cost-method journal entries recorded by Roller Corporation:20X5 Investment in Steam Company Stock 70,000 Cash 70,000 Record purchase of Steam Company stock. Cash 1,000 Dividend Income 1,000 Record dividend income from Steam Company: $5,000 x .2020X6 Cash 3,000 Dividend Income 3,000 Record dividend income from Steam Company: $15,000 x .20 $15,000 x ....
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- Spring '08
- Dividends, Steam Company