What is the gain on sale of shares

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Reference no: EM133492785

Case: On January 1, 2022, Halstead, Incorporated, purchased 71,000 shares of Sedgwick Company common stock for $1,524,000, giving Halstead 25 percent ownership and the ability to apply significant influence over Sedgwick. Any excess of cost over book value acquired was attributed solely to goodwill.

Sedgwick reports net income and dividends as follows. These amounts are assumed to have occurred evenly throughout these years. Dividends are declared and paid in the same period.

Year Net Income Annual Cash Dividends (paid quarterly)
2022 $ 407,000 $ 135,000
2023 540,000 132,000
2024 595,000 167,000

On July 1, 2024, Halstead sells 11,360 shares of this investment for $29 per share, thus reducing its interest from 25 to 21 percent, but maintaining its significant influence.

Total Income Accrual (no unearned gains) = $136,850

What is the gain on sale of shares?

Reference no: EM133492785

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