Accounting for Equity Securities-Noninfluential The Glass Company had the following transactions and adjustment related to a stock investment: 2016 Nov. 15 Purchased 6,000 shares of Erie, Inc.'s common stock at $12.25 per share phus a brokerage commission of $750. Glass expects to sell the stock in the near future. Glass is unable to exercise any significant influence control over Erie. Dec. 22 Received a cash dividend of $1.35 per share of common stock from Erie Dec 31 Made the adjusting entry to reflect year-end fair value of the stock investment in Erie. The year-end market price of the Erie common stock is $11.50 per share 2017 Jan 20 Sold all 6,000 shares of the Erie common stock for $66,900. Record the transactions and adjustment of the Glass Company using journal entries. General Journal Date Description 11/15/2016 Stock investment Noninfluential (Erie) Cash To record purchase of securities 12/22/2016 Cash Dividend income To record receipt of dividend 12/31/2016 Unrealized loss on investments (income) Stock investment Nonnuential (Eri To adjust securities to year end fair value 1/20/2017 Cash Loss on sale of investments Stock investment-Noninfluential ( To record sale of secures ✔ ✔ ✔ ✔ ✔ 44 ✔ Debit 78,750 * 0✔ 12.600 x D✔ 4,500 0 66.900 7.350 x 0 Credit 78,750 x DV 12,600 04 4.500 0 05 74,250
Accounting for Equity Securities-Noninfluential The Glass Company had the following transactions and adjustment related to a stock investment: 2016 Nov. 15 Purchased 6,000 shares of Erie, Inc.'s common stock at $12.25 per share phus a brokerage commission of $750. Glass expects to sell the stock in the near future. Glass is unable to exercise any significant influence control over Erie. Dec. 22 Received a cash dividend of $1.35 per share of common stock from Erie Dec 31 Made the adjusting entry to reflect year-end fair value of the stock investment in Erie. The year-end market price of the Erie common stock is $11.50 per share 2017 Jan 20 Sold all 6,000 shares of the Erie common stock for $66,900. Record the transactions and adjustment of the Glass Company using journal entries. General Journal Date Description 11/15/2016 Stock investment Noninfluential (Erie) Cash To record purchase of securities 12/22/2016 Cash Dividend income To record receipt of dividend 12/31/2016 Unrealized loss on investments (income) Stock investment Nonnuential (Eri To adjust securities to year end fair value 1/20/2017 Cash Loss on sale of investments Stock investment-Noninfluential ( To record sale of secures ✔ ✔ ✔ ✔ ✔ 44 ✔ Debit 78,750 * 0✔ 12.600 x D✔ 4,500 0 66.900 7.350 x 0 Credit 78,750 x DV 12,600 04 4.500 0 05 74,250
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Accounting for Equity Securities-Noninfluential
The Glass Company had the following transactions and adjustment related to a stock investment:
2016
Nov. 15 Purchased 6,000 shares of Erie, Inc.'s common stock at $12.25 per share plus a brokerage commission of $750. Glass expects to sell the stock in the near future.
Glass is unable to exercise any significant influence control over Erie.
Dec. 22
Received a cash dividend of $1.35 per share of common stock from Erie
Dec. 31 Made the adjusting entry to reflect year-end fair value of the stock investment in Erie. The year-end market price of the Erie common stock is $11.50 per share
2017
jan 20 Sold all 6,000 shares of the Erie common stock for $66,900.
Record the transactions and adjustment of the Glass Company using journal entries.
General Journal
Date
Description
11/15/2016 Stock investment Noninfluential (Erie)
Cash
To record purchase of securities
12/22/2016 Cash
Dividend income
To record receipt of dividend
12/31/2016 Unrealized loss on investments (income
Stock investmere Nonnuntial (Eri
To adjust securities to year end fair value
1/20/2017 Cash
Loss on sale of investments
Stock investment Noninfluential re
To record sale of securines
v
✔
Sv
✓
✔
Debit
78,750 M
0
12.600x
DV
4.500
0
66,900
7.350 x
0
Credit
78.750 x
0✔
12.600 x
85
4,500 x
05
05
74,250
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