(Learning Objective 1, 2: Accounting for available-for-sale and equity-method investments) The beginning balance sheet of NASDOQ Corporation included the following:
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Long-Term Investment in MSC Software (equity-method investment)
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$619,000
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NASDOQ completed the following investment transactions during the year:
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Mar.16
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Purchased 2,000 shares of ATI, Inc., common stock as a longterm available-for -sale investment, paying $12.25 per share.
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May.21
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Received cash dividend of $0.75 per share on the ATI investment.
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Aug. 17
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Received cash dividend of $81,000 from MSC Software.
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Dec. 31
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Received annual report from MSC Software; net income for the year was $550,000. Of this amount, NASDOQ's proportion is 22%.
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Required
1. Record the transactions in the journal of NASDOQ Corporation.
2. Post entries to the T-account for Long-Term Investment in MSC and determine its balance at December 31.
3. Show how to report the Long-Term Available-for-Sale Investments and the Long-Term Investment in MSC accounts on NASDOQ's balance sheet at December 31.