Cullumber Corporation purchased 400 shares of Sherman Inc. common stock for $14,100 (Cullumber does not have significant influence). During the year, Sherman paid a cash dividend of $3.25 per share. Assume the stock is nonmarketable.

Prepare Cullumber’s journal entries to record

(a) the purchase of the investment,
(b) the dividends received, and
(c) the fair value adjustment. (Assume a zero balance in the Fair Value Adjustment account.)