On 1 January 2011, Ruby Limited acquired 60% of the issued ordinary shares of Emerald Limited, for R3000. At that date, the retained earnings of Emerald Limited was R1 200. No further shares were issued by Emerald Limited since acquisition. The trial balances for both companies at 31 December 2014 were as follows: Ruby Limited " E "_ Dr//(Cr)_ Emerald Limited qquadDr//Cr_ Sales (26400) (8600) Dividend income (180) Interest income (1000) Gain on fair value adjustment (OCl) - Investment in subsidiary (note 2) (400) Cost of sales 16000 4550 Administration expenses 800 300 Interest expenses 2500 400 Selling and distribution costs 930 750 Tax expense 1800 1080 Dividend declared 2800 300 Share capital (6000) (1600) Fair value adjustment reserve