McDaniel Corporation manufactures surveying equipment. Journalize the entries to record the following selected equity investment transactions completed by McDaniel during 2019: February 26 Purchased for cash 1,350 shares of Demon Inc. stock for $70 per share plus a $75 brokerage commission. April 16 Received dividends of $0.75 per share on Demon Inc. stock. June 18 Purchased 600 shares of Demon Inc. stock for $68 per share plus a $50 brokerage fee. August 19 Sold 1,500 shares of Demon Inc. stock for $72 per share less a $100 brokerage commission. McDaniel assumes that the first investments purchased are the first investments sold. November 14 Received dividends of $0.44 per share on Demon Inc. stock.

McDaniel Corporation manufactures surveying equipment. Journalize the entries to record the following selected equity investment transactions completed by McDaniel during 2019: February 26 Purchased for cash 1,350 shares of Demon Inc. stock for $70 per share plus a $75 brokerage commission. April 16 Received dividends of $0.75 per share on Demon Inc. stock. June 18 Purchased 600 shares of Demon Inc. stock for $68 per share plus a $50 brokerage fee. August 19 Sold 1,500 shares of Demon Inc. stock for $72 per share less a $100 brokerage commission. McDaniel assumes that the first investments purchased are the first investments sold. November 14 Received dividends of $0.44 per share on Demon Inc. stock.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter15: Contributed Capital

Section: Chapter Questions

Problem 14P

See similar textbooks

Similar questions

Investments in Equity Securities Noonan Corporation prepares quarterly financial statements and invests its excess funds in marketable securities. At the end of 2018, Noonans portfolio of investments consisted of the following equity securities: Dunne the first half of 2019, Noonan engaged in the following investment transactions: Required: 1. Record Noonans investment transactions for January 6 through June 30, 2019. 2. Show the items of income or loss from investment transactions that Noonan reports for each of the first and second quarters of 2019. 3. Show how the preceding items are reported on the first and second quarter 2019 ending balance sheets, assuming that management expects to dispose of the Keene and Sachs securities within the next year.
Investments in Equity Securities Manson Incorporated reported investments in equity securities of 60,495 as a current asset on its December 31, 2018, balance sheet. An analysis of Mansons investments on December 31, 2018, reveals the following: During 2019, the following transactions related to Mansons investments occurred: Required: 1. Assuming Manson prepares quarterly financial statements, prepare journal entries to record the preceding information. 2. Show the items of income or loss from investment transactions that Manson reports for each quarter of 2019. 3. Show how Mansons investments are reported on the balance sheet on March 31, 2019; June 30, 2019; September 30, 2019; and December 31, 2019.
Statement of Stockholders' Equity At the end of 2019, Stanley Utilities Inc. had the following equity accounts and balances: During 2020, Haley engaged in the following transactions involving its equity accounts: Sold 5,000 shares of common stock for $19 per share. Sold 1.200 shares of 12%, $50 par preferred stock at $75 per share. Declared and paid cash dividends of $22,000. Repurchased 1,000 shares of treasury stock (common) for $24 per share. Sold 300 of the treasury shares for $26 per share. Required: Prepare the journal entries for Transactions a through e. Assume that 2020 net income was $123,700. Prepare a statement of stockholders equity at December 31, 2020.
Statement of Stockholders' Equity At the end of 2019, Stanley Utilities Inc. had the following equity accounts and balances: During 2020, Stanley Utilities engaged in the following transactions involving its equity accounts: Sold 3,300 shares of common stock for $15 per share. Sold 1,000 shares of 12%, $100 par preferred stock at $105 per share. Declared and paid cash dividends of $8,000. Repurchased 1,000 shares of treasury stock (common) for $38 per share. Sold 400 of the treasury shares for $42 per share. Required: Prepare the journal entries for Transactions a through e. Assume that 2020 net income was $87,000. Prepare a statement of stockholders equity at December 31, 2020.
During your examination of the financial statements of Venus Corporation for the year ended December 31, 2020, you found a new account called "Investments." Your examination revealed that during 2020, Venus began a program of investments, and all investment-related transactions were entered in this account. Your analysis of this account for 2020 follows: VENUS CORPORATION Analysis of Investments Year Ended December 31, 2020 Date—2020 (i) Jupiter Ltd. Common Shares Feb. 14 Purchased 3,000 shares @ $ 55 per share $ 165,000 DR Jul. 26 Received 300 Jupiter common shares as a stock dividend. (Memorandum entry) Sep. 28 Sold the 300 Jupiter common shares received July 26 @ $ 70 per share $ 21,000 Credit (ii) Mars Ltd. Common Shares Apr. 30 Purchased 5,000 shares @ $ 40 per…
Prepare the journal entries to record the following non-strategic investment transactions of Ace Investment Corporation that occurred during the year 2020. April 16 Bought 3,000 common shares of Aby Motors Co. at $22.50 per share August 1 The Board of Directors of Aby Motors Co. declared a dividend of $1.25 per common share to shareholders of record of August 10, payable on August 15 August 15 Received the Aby Motors Co. dividend October 20` Sold the Aby Motors Co. shares at $27.00
Recording Entries for Equity Investment: FV-NI Adjust FVA at Year-End 5M Corporation completed the following transactions, in the order given, relative to the portfolio of stocks held as equity investments measured at FV-NI. Year 2020 1. Purchased 390 shares of Starbux Corporation common stock (par value $1) at $50 per share plus a brokerage commission of 4% and transfer costs of $130 on August 1, 2020. 2. Purchased 780 shares of Kolgate Corporation Class A common stock (par value $0.50) at $35 per share plus transfer costs of $195 on September 15, 2020. Year 2021 1. Purchased 715 shares of Starbux Corporation common stock at $55 per share plus a brokerage commission of 4% and transfer costs of $156 on February 1, 2021. 2. Received declared cash dividends of $2.00 per share on the Kolgate Corporation Class A common stock on June 30, 2021. 3. Sold 195 shares of Starbux Corporation common stock at $58 per share on August 15, 2021. Year-End Stock Prices 2020 2021 Starbux,…
2. Prepare the necessary journal entries for Vidalia's investment in Woodbine common stock. In 2022, Vidalia had the following activities in long-term investments: Question Group (1) May 10 Purchased 50,000 shares of Woodbine stock for $15 per share. Short Answer Attachment Upload (2) August 24 Short Answer 6 Received a cash dividend of $2 per share on Woodbine stock. Attachment Upload I (3) December 31 Woodbine reported net income of $478,000. Woodbine has 125,000 shares of common stock outstanding. Short Answer
Journalizing equity investment transactions; fair value method Seamus Industries Inc. buys and sells investments as part of its ongoing cash management. The following investment transactions were completed during the year: Feb. 24. Purchased 1,000 shares of Tett Co.'s common stock for $85 per share. May 16. Purchased 2,500 shares of Isaacson Co.'s common stock for $35. July 14. Sold 400 shares of Tett Co. stock for $102 per share. Aug. 12. Sold 750 shares of Isaacson Co. stock for $32 per share. Oct. 31. Received dividends of $0.40 per share on Tett Co. stock. Dec. 31. At the end of the accounting period, the fair value of the remaining 600 shares of Tett Co.'s stock was $110 per share. The fair value of the remaining 1,750 shares of Isaacson Co.'s stock was $30 per share. Journalize the entries for these transactions. If an amount box does not require an entry, leave it blank. Feb. 24 May 16 July 14 Aug. 12 Oct. 31 Dec. 31
Accounting for equity investments On January 1, 2018, Bryant, Inc. decides to invest in 3,750 shares of Farrier stock when the stock is selling for $16 per share. On August 1, 2018, Farrier paid a $1.70 per share cash dividend to stockholders. On December 31, 2018, Farrier reports a net income of $50,000 for 2018. Assume Farrier has 15,000 shares of voting stock outstanding during 2018 and Bryant has significant influence over Farrier. Requirements Identify what type of investment the Farrier stock is for Bryant. Journalize the transactions related to Bryant’s investment in the Farrier stock during 2018. In what category and at what value would Bryant’s report the investment on the December 31, 2018, balance sheet?
During 2021, Paver Financial Corporation had the following trading investment transactions: Feb. 1 Purchased 560 CBF common shares for $35,280. Mar. 1 Purchased 750 RSD common shares for $21,750. Apr. 1 Purchased 7% MRT bonds at face value, for $56,000. Paver received interest from these bonds semi-annually on April 1 and October 1. July 1 Received a cash dividend of $3 per share on the CBF common shares. Aug. 1 Sold 180 CBF common shares at $62 per share. Oct. 1 Received the semi-annual interest on the MRT bonds. 1 Sold the MRT bonds for $57,900. Dec. 30 RSD declared a dividend of $1.60 per share, payable on January 15 next year. Dec. 31 The market prices of the CBF and RSD common shares were $59 and $30 per share, respectively. Determine the balance in each of the statement of income accounts that is affected in the transactions above and indicate how the accounts would be presented on the statement of income for the year ended December…
Accounting Swifty Corp. has the following portfolio of securities acquired for trading purposes and accounted for using the FV-NI model at September 30, 2020, the end of the company’s third quarter: Investment Cost Fair Value 53,000 common shares of Yuen Inc. $355,100 $212,000 4,300 preferred shares of Monty Ltd. 163,400 172,000 1,900 common shares of Oakwood Inc. 171,000 170,050 On October 8, 2020, the Yuen shares were sold for $6.70 per share. On November 16, 2020, 3,000 common shares of Patriot Corp. were purchased at $44.90 per share. Swifty pays a 1% commission on purchases and sales of all securities. At the end of the fourth quarter, on December 31, 2020, the fair values of the shares held were as follows: Monty $103,700; Patriot $119,500; and Oakwood $192,850. Swifty prepares financial statements every quarter. (a) Prepare the journal entries to record the sale, purchase, and adjusting entries related to the portfolio for the fourth quarter of 2020.…