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Answer-
| Equity Method:- | |
| Acquisition Cost, Jan.01,2020 | $81,200 |
| Add: Income on Equity Investment ($54,200 *40%) | $21,680 |
| Less: Dividend ($18,000*40%) | -$7,200 |
| Less: Amortization of patent ($55,400-$7,400)*40%/ 6 | -$3,200 |
| Investment in Holister Account, December 31,2020 | $92,480 |
| Add: Income on Equity Investment ($66,700*40%) | $26,680 |
| Less: Dividend ($23,000*40%) | -$9,200 |
| Less: Amortization of Patent ($55,400-$7,400) *40%/ 6 | -$3,200 |
| Investment in Holister Account, December 31,2021 | $106,760 |
b-Fair Value
| Dividend revenue 2021($23,000*40%) | $9,200 |
| Fair value adjustment ($98,960-$95,480) | $3,480 |
| Income from the Investment in Holister, December 31,2021 | $12,680 |
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