In: Accounting
delete
| Equity method income accrual for 2018 | |
| 25% of $589,000 for ½ year | $ 73,625 | 
| 21% of $589,000 for ½ year | $ 61,845 | 
| Total income accrual | $ 135,470 | 
| Gain on sale (Refer Below) | $ 118,680 | 
| Total income statement effect–2018 | $ 254,150 | 
| Gain on sale of 13,800 shares of Halstead | |
| Initial acquisition- 2016 | $ 1,510,000 | 
| 25% income accrual- 2016: (25% × $362,000) | $ 90,500 | 
| Dividend - 2016 (25%*137,000) | $ (34,250) | 
| 25% income accrual- 2017: (25% × $505,000) | $ 126,250 | 
| Dividend - 2017 (25%*134,000) | $ (33,500) | 
| 25% income accrual for ½ year- 2018 | $ 73,625 | 
| (25%*589000/2) | |
| 25% of dividends for ½ year- 2018 | $ (20,625) | 
| (25%*165000/2) | |
| Book value of 80,000 shares on July 1, 2018 | $ 1,712,000 | 
| Cash proceeds from the sale of 13,800 shares | $ 414,000 | 
| (13,800*30) | |
| Less: Book value of shares sold | $ 295,320 | 
| ($1,712,000*(13,800 ÷ 80,000)) | |
| Gain on Sale | $ 118,680 |