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Darlene Inc. purchased 20,800 common shares (20%) of Carlyle Ltd. on January 1, Year 4, for $270,400. It did not have significant influence over
Darlene Inc. purchased 20,800 common shares (20%) of Carlyle Ltd. on January 1, Year 4, for $270,400. It did not have significant influence over Carlyle. It elected to classify the investment as fair value through OCI. On September 30, Year 5, Darlene obtained significant influence when there was a restructuring of the Board of Directors. Accordingly, Darlene adopted the equity method on a prospective basis. Additional information on Carlyle for the two years ending December 31, Year 5, is as follows: Market Value Period Year 4 Net Income $158,000 Dividends Paid per Share at end of period $98,000 $14.00 Jan.-Sept. Year 5 118,000 78,000 Oct.-Dec. Year 5 52,000 22,000 14.60 15.00 On January 1, Year 6, Darlene sold its investment in Carlyle for $312,000. Required: (a) Calculate the balance in the investment account at the end of each period. (Omit $ sign in your response.)
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