Homework Answers
| Account titles and explanation | Debit | Credit | |||
| Section A | A | Investment in shares | $100,000 | ||
| Cash | $100,000 | ||||
| (investment made in shares) | |||||
| B | No entry | ||||
| C | Cash | $3,000 | |||
| Dividend income | $3,000 | ||||
| (Dividend received on shares 30,000*10%) | |||||
| Section B | A | Investment in affiliate | $300,000 | ||
| Cash | $300,000 | ||||
| (Investment made in company and aquired significance influence) | |||||
| B | Investment in affiliate | $30,000 | (100,000*30%) | ||
| Equity income in affiliate | $30,000 | (100,000*30%) | |||
| (Net income in affiliate recorded) | |||||
| C | Cash | $12,000 | (40000*30%) | ||
| Investment in affiliate | $12,000 | (40000*30%) | |||
| (Dividend recorded) | |||||
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