Accounting for Investments Using the Cost and Equity Methods

On 1/1/16, Integrity Corporation?s net worth was as follows:

Common stock (15,000 shares, $10 par value)	$ 150,000
Additional paid-in-capital	30,000
Retained earnings	60,000
Total	$240,000

On 1/1/16, Honesty, Inc. purchased 2,500 shares of Integrity Corporation at a price of $29 per share. Integrity Corporation?s equity securities are not readily marketable. Honesty could not attribute any of the excess cost over book value to any specific Integrity assets and considered this excess to be goodwill.

Integrity?s earnings and dividends for the next three years were as follows:

Year	Net Income	Dividends
2016	10,000	6,000
2017	25,000	30,000
2018	80,000	40,000

Required:

For Honesty, Inc.?s financial statements: Year	Balance sheet amount reported for Investment in Integrity Corporation at end of 12/31	Income statement amount reported for Investment Income from Integrity Corporation for the fiscal year ended 12/31
2016
2017
2018

Attach an excel spreadsheet containing documentation to support the above reported amounts.

For Honesty, Inc.?s financial statements: Year	Balance sheet amount reported for Investment in Integrity Corporation at end of 12/31	Income statement amount reported for Investment Income from Integrity Corporation for the fiscal year ended 12/31
2016
2017
2018

Attach an excel spreadsheet containing documentation to support the above reported amounts.

Accounting for Investments Using the Cost and Equity Methods On 1/1/16, Integrity Corporation's net worth was as follows: Common stock (15,000 shares, $10 par value) Additional paid-in-capital Retained earnings Total $ 150,000 30,000 60,000 $240,000 On 1/1/16, Honesty, Inc. purchased 2,500 shares of Integrity Corporation at a price of $29 per share. Integrity Corporation's equity securities are not readily marketable. Honesty could not attribute any of the excess cost over book value to any specific Integrity assets and considered this excess to be goodwill. Integrity's earnings and dividends for the next three years were as follows: Year Net Income Dividends 2016 2017 2018 10,000 25,000 80,000 6,000 30,000 40,000 Required: 1. Complete the following table, assuming that Honesty, Inc. had significant influence over Integrity Corporation: For Honesty, Inc.'s financial statements: Year Balance sheet amount reported for Investment in Integrity Corporation at end of 12/31 Income statement amount reported for Investment Income from Integrity Corporation for the fiscal year ended 12/31 2016 2017 2018 Attach an excel spreadsheet containing documentation to support the above reported amounts. 2. Complete the following table, assuming that Honesty, Inc. did not have significant influence over Integrity Corporation: For Honesty, Inc.'s financial statements: Year Balance sheet amount reported for Investment in Integrity Corporation at end of 12/31 Income statement amount reported for Investment Income from Integrity Corporation for the fiscal year ended 12/31 2016 2017 2018 Attach an excel spreadsheet containing documentation to support the above reported amounts