As a long-term investment, Painters' Equipment Company purchased 20% of AMC Supplies Incorporated's 480,000 shares for $560,000 at the beginning of the fiscal year of both companies. On the purchase date, the fair value and book value of AMC's net assets were equal. During the year, AMC earned net income of $330,000 and distributed cash dividends of 25 cents per share. At year-end, the fair value of the shares is $593,000 Record the cash dividend of 25 cents per share. Record any necessary year - end adjusting journal entry when the fair value of the shares held are $ 593,000 at year-end.
As a long-term investment, Painters' Equipment Company purchased 20% of AMC Supplies Incorporated's 480,000 shares for $560,000 at the beginning of the fiscal year of both companies. On the purchase date, the fair value and book value of AMC's net assets were equal. During the year, AMC earned net income of $330,000 and distributed cash dividends of 25 cents per share. At year-end, the fair value of the shares is $593,000 Record the cash dividend of 25 cents per share. Record any necessary year - end adjusting journal entry when the fair value of the shares held are $ 593,000 at year-end.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:As a long-term investment, Painters' Equipment Company purchased 20% of AMC Supplies Incorporated's 480,000
shares for $560,000 at the beginning of the fiscal year of both companies. On the purchase date, the fair value and book
value of AMC's net assets were equal. During the year, AMC earned net income of $330,000 and distributed cash
dividends of 25 cents per share. At year-end, the fair value of the shares is $593,000 Record the cash dividend of 25
cents per share. Record any necessary year - end adjusting journal entry when the fair value of the shares held are $
593,000 at year-end.
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