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Hamilton Ltd. was organized on January 2, 2017. The following investment transactions and events occurred during...

Hamilton Ltd. was organized on January 2, 2017. The following investment transactions and events occurred during the following months:

2017
Jan. 6 Hamilton paid $575,500 for 50,000 shares (20%) of Wong Inc. outstanding common shares.
Apr. 30 Wong declared and paid a cash dividend of $1.10 per share.
Dec. 31 Wong announced that its profit for 2017 was $480,000. Fair value of the shares was $11.80 per share.
2018
Oct. 15 Wong declared and paid a cash dividend of $0.70 per share.
Dec. 31 Wong announced that its profit for 2018 was $630,000. Fair value of the shares was $12.18 per share.
2019
Jan. 5 Hamilton sold all of its investment in Wong for $682,000 cash.


Assume that Hamilton has a significant influence over Wong with its 20% share.

Required:
1. Prepare the entries to record the preceding transactions in Hamilton’s books. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)



2. Calculate the carrying value per share of Hamilton’s investment as reflected in the investment account on January 4, 2019. (Round your answer to 2 decimal places.)



3. Calculate the change in Hamilton’s equity from January 2, 2017, through January 5, 2019, resulting from its investment in Wong.

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Expert Solution

ekkarill92 answered 1 year ago
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