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I got the gain wrong. Please help On January 1, 2016. Halstead, Inc.. purchased 68,000 shares of Sedgwick Company common stock for $1,397,000, giving Halstead
I got the gain wrong. Please help
On January 1, 2016. Halstead, Inc.. purchased 68,000 shares of Sedgwick Company common stock for $1,397,000, giving Halstead 25 percent ownership and the ability to apply significant influence over Sedgwick. Any excess of cost over book value acquired was attributed solely to goodwill. Sedgwick reports net income and dividends as follows. These amounts are assumed to have occurred evenly throughout these years. Dividends are declared and paid in the same period. 2016 2017 2018 Net Income $335, eee 524,000 614,800 Annual Cash Dividends (paid quarterly) $137,000 148,06 171,000 On July 1, 2018, Halstead sells 13,400 shares of this investment for $30 per share, thus reducing its interest from 25 to 21 percent, but maintaining its significant influence. Determine the amounts that would appear on Halstead's 2018 income statement relating to its ownership and partial sale of its investment in Sedgwick's common stock. $ As total income accrual (no unearned gains) As gain on sale of shares 141 220 $ 13,486Step by Step Solution
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