On January 4, 2021, Colton Corp. acquired 30% of the outstanding common stock of Hicks Co. for $1,300,000. This acquisition gave Colton the ability to exercise significant influence over the investee. The book value of the acquired shares was $1,175,000. Any excess cost over the underlying book value was assigned to a copyright that was undervalued on Hicks's balance sheet. This copyright has a remaining useful life of ten years. For the year ended December 31, 2021, Hicks reported net income of $368,000 and paid cash dividends of $107,000.Required:Prepare a schedule to show the balance Colton should report as its Investment in Hicks Co. at December 31, 2021.

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The Answer of On January 4, 2021, Colton Corp. acquired 30% of the outstanding common stock of Hicks Co. for $1,300,000. This acquisition gave Colton the ability to exercise significant influence over the investee. The book value of the acquired shares was $1,175,000. Any excess cost over the underlying book value was assigned to a copyright that was undervalued on Hicks's balance sheet. This copyright has a remaining useful life of ten years. For the year ended December 31, 2021, Hicks reported net income of $368,000 and paid cash dividends of $107,000.Required:Prepare a schedule to show the balance Colton should report as its Investment in Hicks Co. at December 31, 2021.