Equity Investments: Less than 20% ownershipOn September 12, 3,100 shares of Denver Company's common stock are acquired at a price of $53 per share plus a $155 brokeragecommission. On October 15, an $1.30-per-share dividend was received on the Denver Company stock. On November 10, 1,240 shares ofthe Denver Company stock were sold for $48 per share less a $62 brokerage commission. At the end of the accounting period onDecember 31, the fair value of the remaining 1,860 shares of Denver Company's stock was $47 per share. Denver Company has 360,000shares of common stock outstanding.Journalize the entries for the original purchase, dividend, sale, and change in fair value under the fair value method. If an amount boxdoes not require an entry, leave it blank.Sep. 12 Investments-Denver Company StockCashOct. 15 CashDividend RevenueNov. 10 CashLoss on Sale of InvestmentsInvestments-Denver Company StockDec. 31 Unrealized Loss on Equity InvestmentsValuation Allowance for Equity Investments☐ ☐

The journal entries are prepared to record the transactions on a regular basis. The adjustment…

Answered: Equity Investments: Less than 20%…

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter20: Corporations: Organization And Capital Stock

Section: Chapter Questions

Problem 8SPA: STOCK SUBSCRIPTIONS Juneau Associates had the following stock transactions during the year: (a)...

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Selected transactions completed by Equinox Products Inc. during the fiscal year ended December 31, 2016, were as follows: a. Issued 15,000 shares of 20 par common stock at 30, receiving cash. b. Issued 4, 000 shares of 80 par preferred 5% stock at 100, receiving cash. c. Issued 500,000 of 10-year, 5% bonds at 104, with interest payable semiannually. d. Declared a quarterly dividend of 0.50 per share on common stock and 1.00 per share on preferred stock. On the date of record, 100,000 shares of common stock were outstanding, no treasury shares were held, and 20,000 shares of preferred stock were outstanding. e. Paid the cash dividends declared in (d). f. Purchased 7,500 shares of Solstice Corp. at 40 per share, plus a 150 brokerage commission. The investment is classified as an available-for-sale investment. g. Purchased 8,000 shares of treasury common stock at 33 per share. h. Purchased 40,000 shares of Pinkberry Co. stock directly from the founders for 24 per share. Pinkberry has 125,000 shares issued and outstanding. Equinox Products Inc. treated the investment as an equity method investment. i. Declared a 1.00 quarterly cash dividend per share on preferred stock. On the date of record, 20,000 shares of preferred stock had been issued. j. Paid the cash dividends to the preferred stockholders. k. Received 27,500 dividend from Pinkberry Co. investment in (h). l. Purchased 90,000 of Dream Inc. 10-year, 5% bonds, directly from the issuing company, at their face amount plus accrued interest of 37 5. The bonds are classified as a held-to-maturity long -term investment. m. Sold, at 38 per share, 2,600 shares of treasury common stock purchased in (g). n. Received a dividend of 0 .60 per share from the Solstice Corp. investment in (f). o. Sold 1,000 shares of Solstice Corp. at 45, including commission. p. Recorded the payment of semiannual interest on the bonds issue d in (c) and the amortization of the premium for six months. The amortization is determined using the straight-line method . q. Accrued interest for three months on the Dream Inc. bonds purchased in (I). r. Pinkberry Co. recorded total earnings of 240 ,000. Equinox Products recorded equity earnings for its share of Pinkberry Co. net income. s. The fair value for Solstice Corp. stock was 39. 02 per share on December 31, 2016. The investment is adjusted to fair value , using a valuation allowance account. Assume Valuation Allowance for Available-for-Sale Investments h ad a beginning balance of zero. Instructions 1. Journalize the selected transactions. 2. After all of the transaction s for the year ended December 31, 201 6, had been poste d [including the transactions recorded in part (1) and all adjusting entries), the data that follows were taken from the records of Equinox Products Inc. a. Prepare a multiple-step in come statement for the year ended December 31, 201 6, concluding with earnings per share . In computing earnings per share, assume that the average number of common shares outstanding was 100,000 and preferred dividends were 100,000. ( Round earnings per share to the nearest cent.) b. Prepare a retained earnings statement for the year ended December 31, 20 6. c. Prepare a balance sheet in report form as of December 31, 2016.
Stockholders equity accounts and other related accounts of Gonzales Company as of January 1, 20--, the beginning of its fiscal year, are shown below. (a)Received 20,000 for the balance due on subscriptions for preferred stock with a par value of 40,000 and issued the stock. (b)Purchased 10,000 shares of common treasury stock for 18 per share. (c)Received subscriptions for 10,000 shares of common stock at 19 per share, collecting down payments of 45,000. (d)Issued 15,000 shares of common stock in exchange for land with a fair market value of 290,000. (e)Sold 5,000 shares of common treasury stock for Si00,000. (f)Issued 10,000 shares of preferred stock at 11.50 per share, receiving cash. (g)Sold 3,000 shares of common treasury stock for 17 per share. REQUIRED 1. Prepare general journal entries for the transactions, identifying each transaction by letter. 2. Post the journal entries to appropriate T accounts. The cash account has a beginning balance of 300,000. 3. Prepare the stockholders equity section of the balance sheet as of December 31, 20--. Net income for the year was 825,000 and dividends of 400,000 were paid.
STOCK SUBSCRIPTIONS Juneau Associates had the following stock transactions during the year: (a) Received subscriptions for 100,000 shares of 1 par common stock for 105,000. (b) Received subscriptions for 5,000 shares of 15 par, 8% preferred stock for 80,000. (c) Received a payment of 55,000 on the common stock subscription. (d) Received a payment of 40,000 on the preferred stock subscription. (e) Issued 40,000 shares of 1 par common stock in exchange for a truck with a fair market value of 48,000. (f) Received the balance in full for the common stock subscription and issued the stock. (g) Received the balance in full for the preferred stock subscription and issued the stock. REQUIRED Prepare general journal entries for these transactions, identifying each by letter.
Equity Investments: Less than 20% ownership On September 12, 3,300 shares of Denver Company's common stock are acquired at a price of $51 per share plus a $165 brokerage commission. On October 15, an $1.10-per-share dividend was received on the Denver Company stock. On November 10, 1,320 shares of the Denver Company stock were sold for $44 per share less a $66 brokerage commission. At the end of the accounting period on December 31, the fair value of the remaining 1,980 shares of Denver Company's stock was $43 per share. Denver Company has 350,000 shares of common stock outstanding. Journalize the entries for the original purchase, dividend, sale, and change in fair value under the fair value method. If an amount box does not require an entry, leave it blank. Sep. 12 Investments-Denver Company Stock Cash Oct. 15 Cash Dividend Revenue Nov. 10 Cash Loss on Sale of Investments Investments-Denver Company Stock Dec. 31 Unrealized Loss on Equity Investments Valuation Allowance for Equity…
Equity Investments: Less than 20% ownership On September 12, 2,700 shares of Denver Company's common stock are acquired at a price of $63 per share plus a $135 brokerage commission. On October 15, an $1.30-per-share dividend was received on the Denver Company stock. On November 10, 1,080 shares of the Denver Company stock were sold for $56 per share less a $54 brokerage commission. At the end of the accounting period on December 31, the fair value of the remaining 1,620 shares of Denver Company's stock was $55 per share. Denver Company has 370,000 shares of common stock outstanding. Journalize the entries for the original purchase, dividend, sale, and change in fair value under the fair value method. If an amount box does not require an entry, leave it blank. Sep. 12 Oct. 15 Nov. 10 Dec. 31
Equity Investments: Less than 20% ownership On September 12, 3,600 shares of Denver Company’s common stock are acquired at a price of $65 per share plus a $180 brokerage commission. On October 15, an $0.80-per-share dividend was received on the Denver Company stock. On November 10, 1,440 shares of the Denver Company stock were sold for $59 per share less a $72 brokerage commission. At the end of the accounting period on December 31, the fair value of the remaining 2,160 shares of Denver Company’s stock was $58 per share. Denver Company has 350,000 shares of common stock outstanding. Journalize the entries for the original purchase, dividend, sale, and change in fair value under the fair value method. If an amount box does not require an entry, leave it blank. Sep. 12 Investments-Denver Company Stock 234,180 (Debit) Cash 234,180 (Credit) Oct. 15 Cash 2,880 (Debit) Dividend Revenue 2,880 (Credit) Nov. 10 Cash 84,888 (Debit) Loss on Sale…
Equity Investments: Less than 20% ownership On September 12, 2,500 shares of Denver Company’s common stock are acquired at a price of $44 per share plus a $125 brokerage commission. On October 15, an $0.80-per-share dividend was received on the Denver Company stock. On November 10, 1,000 shares of the Denver Company stock were sold for $39 per share less a $50 brokerage commission. At the end of the accounting period on December 31, the fair value of the remaining 1,500 shares of Denver Company’s stock was $38 per share. Denver Company has 370,000 shares of common stock outstanding. Journalize the entries for the original purchase, dividend, sale, and change in fair value under the fair value method. If an amount box does not require an entry, leave it blank. Sep. 12 Investments-Denver Company Stock Investments-Denver Company Stock Cash Cash Oct. 15 Cash Cash Dividend Revenue Dividend Revenue Nov. 10 Cash Cash Loss on Sale of Investments…
Equity Investments: Less than 20% Ownership On January 23, 17,000 shares of Aurora Company’s common stock are acquired at a price of $24 per share plus a $180 brokerage commission. On April 12, a $0.30-per-share dividend was received on the Aurora Company stock. On June 10, 6,600 shares of the Aurora Company stock were sold for $31 per share less a $125 brokerage commission. At the end of the accounting period on December 31, the fair value of the remaining 10,400 shares of Aurora Company’s stock was $30 per share. Aurora Company has 220,000 shares of common stock outstanding. Journalize the entries for the original purchase, dividend, sale, and change in fair value under the fair value method. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered. When…
How to journalize the entry for december 31? Apr. 10 Purchased 5,000 shares of Delew Company’s common stock for a price of $49 per share plus a brokerage commission of $90. Delew Company has 230,000 shares of common stock outstanding. July 8 Received a quarterly dividend of $1.00 per share on the Delew Company investment. Sept. 10 Sold 1,100 shares for a price of $44 per share less a brokerage commission of $70. Dec. 31 At the end of the accounting period, the fair value of the remaining 3,900 shares of Delew Company’s stock was $48.52 per share.

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