LO$2$

On January $1,$ Year $5,$ Pic Company acquired $7,500$ ordinary shares of Sic Company for $$717,000.$ On January $1,$ Year $6,$ Pic Company acquired an additional $2,000$ ordinary shares of Sic Company for $$197,000.$ On January $1,$ Year $5,$ the shareholders' equity of Sic was as follows:

Ordinary shares $(10,000$ no par value shares issued$)$

$$200,000$

Retained earnings

$\frac{321,000}{\text{\$}521,000}$

Page $493$

The following are the statements of retained earnings for the two companies for Years $5$ and $6$ :

$\backslash$table$[[,$Pic,,,$],[,$Year $5,$Year $6,$Year $5,$Year $6],[$Retained earnings, beginning of year,$$542,000,$$$593,000,$$$321,000,$$$344,000$