Hamilton Ltd. was organized on January 2, 2014. The following investment transactions and events subsequently occurred: Assume
Question:
Assume that Hamilton has a significant influence over Ginto with its 20% share.
Required
1. Give the entries to record the preceding transactions in Hamiltons books.
2. Calculate the carrying value per share of Hamiltons investment as reflected in the investment account on January 4, 2016.
3. Calculate the change in Hamiltons equity from January 6, 2014, through January 5, 2016, resulting from its investment inGinto.
Transcribed Image Text:
2014 6 Jan. Hamilton paid $575,500 for 50,000 shares (20%) of Ginto Inc. outstanding common shares. Apr 30 Ginto declared and paid a cash dividend of $1.10 per share. Dec. 31 Ginto announced that its net income for 2014 was $480,000. Fair value of the shares was $11.80 per share. Oct. Dec. 2015 15 31 Ginto declared and paid a cash dividend of $0.70 per share. Ginto announced that its net income for 2015 was $630,000. Fair value of the shares was $12.18 per share. 2016 5 Jan. Hamilton sold all of its investment in Ginto for $682,000 cash.
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Part 1 1 2014 Jan 6 Equity Investment Ginto Inc Common Shares 575500 Cash 575500 To record purchase ...View the full answer
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Related Book For
Fundamental Accounting Principles Volume II
ISBN: 978-1259066511
14th Canadian Edition
Authors: Larson Kermit, Jensen Tilly
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