Answered: 6. To acquire Gaines Corporation stock,…

6. To acquire Gaines Corporation stock, Palmer Co. pays $61,500 in cash. What entry should be made for this investment, assuming the stock is readily marketable?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Accounting for the Equity Investment When Price Exceeds Book Value Assume an investor purchases all…

A: The investor has purchased all the shares of the investee company, therefore the Equity method is…

Q: e) Suppose that on 31 Dec 2020 ABC purchased a new logistics and storage facility for €100.000, to…

A: Adjusted trial balance: Adjusted trial balance can be defined as the trial balance prepared after…

Q: WikWok hires a consultant for a new project, and issues common stock with a par value of $100 in…

A: Journal entries refers to the entries which are made at the end of the period or year and it records…

Q: Gaines Corporation invested $124,000 to acquire 21,000 shares of Owens Technologies, Inc. on March…

A: Lets understand the basics. When entity holds less than the 20% of the ownership of the invested…

Q: 1. On January 3, 2020, Castle Corporation purchased the following equity securities as an…

A: Notes: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the…

Q: Common Stock Holdings-Blue Investments, Inc. Cash Equity Investments-Blue Investments, Inc. Cash…

A: There is need of record in the journal for each and every transactions made and there is double…

Q: You purchased some shares in FlyingDutchman.com on 26 August 2022, at price $54.86. On 28 January…

A: Given, The purchase price of stock is $54.86. Dividends paid $1.69 and $1.93

Q: XYZ's stock price and dividend history are as follows. Year 2018 2019 2020 2021 Beginning-of-Year…

A: The Arithmetic Average Rate of Return (AARR) and the Geometric Average Rate of Return (GARR) are two…

Q: Question 2 On December 21, 2020, Vaughn Company provided you with the following information…

A: Journal entries refer to the recording of transactions in an appropriate way. With the help of…

Q: P17.11 (Page 17– 70) Fernandez SA invested its excess cash in equity investments during 2019. The…

A: Equity Investments Equity investments is measured at fair value(As per IFRS 9) Changes in value is…

Q: If Apple Computer decided to issue additional common stock, and someone purchased 100 shares of this…

A: When companies issue additional shares, the amount of common stock listed on the stock exchange…

Q: company should use the equity method to account for an investment if O it has the ability to…

A: Significant influence means where entity's (the investor's) capacity to exercise a significant…

Q: A company paid $37,800 cash to acquire stock investments with insignificant influence. The correct…

A: Significant influence means that the investor has the ability to participate in financial and…

Q: LL R You are considering a stock investment in one of two firms (LotsofDebt, Inc. and LotsofEquity,…

A: Debt Ratio is calculated as total debt divided by the total assets. Equity multiplier is calculated…

Q: A company has the following balance sheet (market values): Liabilities + Equity Debt Equity Assets…

A: Market value of equity = 1,200Number of shares outstanding = 300The current share price is

Q: 2025, Swifty Company provided you with the following information regarding its equity investments.…

A: Adjusting Entry -An adjustment journal entry is a general ledger entry made by a business at the…

Q: Selected Stocks from the Dow Jones Industrial Average for a Day in 2015 me 8 DRES OGS Symbol Open…

A: Profit or loss on the stock sale Profit or loss on the stock sale is calculated as shown below.…

Q: Year 2018 2019 Beginning-of-Year Price $100 110 Dividend Paid at Year-End $4 4

A: In this question XYZ stock price and dividend history are as follows YearBeginning of the year price…

Q: National Financial Services, Inc. invested $30,000 to acquire 3,750 shares of Stonebridge…

A: If the shares sold with a increased price than the purchased price the gain on sale of shares will…

Q: In preparation for developing its statement of cash flows for the year ended December 31, 2024,…

A: Explanation:The cash flows statement is one of the Financial statement, it shows the cash inflows…

Q: Question # 2: Which of the following statements is CORRECT? a. If Apple issues…

A: Question no.2 In the above question the correct statement would be C. IPO is an example of primary…

Q: ) For a listed company of ABC, total book value of assets is 40 million, total market value of…

A: Shareholders are the owners of the company and true value of company is market value of the…

Q: Company A’s EPS is $1.50. Its closest competitor, Company B, is trading at a P/E of 22 Assume the…

A: Given information: Company A’s EPS is $1.50 Company is trading at P/E of 22 Company A stock is…

Q: The following data pertains to Traverse Co.'s investments in marketable equity securities: Select…

A: Calculations: Market value on 12/31/24 $155,000 Cost ($150,000) Unrealized gain on…

Q: Company A is currently selling for $130 per share and has earnings of $13 per share. Company B is…

A: Price to Earnings Ratio: PE ratio relates a firm's share price to its EPS (earnings per share). The…

Q: a. What net income would Ravine Corporation have reported for each of the years, assuming Ravine…

A: Under the equity method, initially, the investment is recorded at cost, and subsequent changes in…

Q: You have been presented with the following set of financial statements for National Property Trust,…

A: Ratios are considered as a good measure of a company's performance in terms of its profitability,…

Question

6. To acquire Gaines Corporation stock, Palmer Co. pays
$61,500 in cash. What entry should be made for this
investment, assuming the stock is readily marketable?

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

16. ABC bought 100 common shares of XYZ. The price paid was $ 40, per share, plus he paid $ 280 in brokerage costs. The entry to register this purchase includes: Select one: a. debit to cash for $ 4,000. b. Debit to Investment in shares of $ 4,000. c. Debit to Investment in shares for $ 4,280. d. debit to brokerage expense of $ 280 and a debit to investment in shares of $ 4,000.
Question: Match the key term to the scenario. Terms: 1. Available-for-Sale Investments 2. Controlling Interest Investment 3. Trading Investments 4. Held-to-maturity Investments 5. Significant Interest Investment Scenarios: a. Jane owns 53% of Richard's Roses voting stock. b. Joe owns a debt security in Bones, Inc. and intends to hold it until maturity. c. Jeannie owns 18% of Cricket, Inc. voting stock and plans on selling the stock after one year. d. Jacob owns 24% of Pay, Inc. voting stock. e. Jim owns 10% of Tag, Inc. voting stock and plans on selling the stock next week.
34) can you please help with this question?
1. The cost method of accounting for stock investments is used when the company acquires a. Greater than 50% of the company's stock b. Between 20% to 50% of the company's stock c. Less than 20% of the company's stock 2. The significance of percentage of ownership relates to how much _____________ the acquiring company has in the new company. a. data b. control c. confidence
2a
If Genie went ahead with the acquisition of Aladdin, what is the total value of the acquisition? ( What is the maximum price per share that Genie should be willing to pay for this acquisition? 3)If Genie decided to go ahead with the cash acquisition, what will be its price per share after the acquisition?
Carlin Enterprises purchased 2,000 shares of the 2,000,000 common shares outstanding in Captain Inc. Carlin intends to hold on to this investment for the foreseeable future. How should this investment be classified on the books of Carlin? O trading equity investment O held-to-maturity debt investment O held-to-maturity equity investment O available-for-sale equity investment Question 23 eld-to-maturity securities affects other comprehensive income and appear as financing activities on the statement of cash flows. es to financial statements.
What is the investors rate of return ?
nit.9
Received a $400 dividend from our investment in Masco Company stock. The investment is treated as an equal method investment. What is the general journal entry?
hrl.3
Carlin Enterprises purchased 2,000 shares of the 2,000,000 common shares outstanding in Captain Inc. Carlin intends to hold on to this investme for the foreseeable future. How should this investment be classified on the books of Carlin? O trading equity investment O held-to-maturity debt investment O held-to-maturity equity investment O available-for-sale equity investment Question 23 Held-to-maturity securities O affects other comprehensive income and appear as financing activities on the statement of cash flows. are never disclosed in the notes to financial statements