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Sandhu Travel Agency Ltd. has 400,000 common shares authorized and 126,000 shares issued on December 31, 2020. On January 2, 2021, Marx Inc. purchased
Sandhu Travel Agency Ltd. has 400,000 common shares authorized and 126,000 shares issued on December 31, 2020. On January 2, 2021, Marx Inc. purchased shares of Sandhu Travel Agency for $39 per share. Marx intends to hold these shares as a long-term investment. Marx's accountant prepared a trial balance at December 31, 2021, under the assumption that Marx could not exercise significant influence over Sandhu Travel Agency. Under this assumption, the trial balance included the following accounts and amounts related to the Sandhu investment: Long-term investments Dividend income $1,417,500 157,500 Unrealized gain on long-term investments 189,000
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