AssetsLiabilitiesCapital stockRetained earningsTotal equitiesAssetsLiabilitiesCapital stockRetained earningsTotal equitiesBalance SheetDecember 31, 2025Skysong CompanyBalance SheetDecember 31, 2025$2040000$2100001020000810000$2040000$1440000$320000970000150000$1440000If Oriole Company acquired a 30% interest in Skysong Company on December 31, 2025 for $350000 and during 2026, Skysong hadnet income of $141000 and paid a cash dividend of $51000, applying the equity method would result in a debit balance in the EquityInvestments (Skysong) account at the end of 2026 ofO $392300.○ $377000.○ $350000.O $334700.

Detailed explanation:Equity investments is recorded at cost when acquired.Share in net income of…

Answered: Assets Liabilities Capital stock…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The investments of Harlon Enterprises included the following cost and fair value amounts ($ in millions): Fair Value, Dec. 31 2022 N/A $ 37 Equity Investments A Corporation shares B Corporation shares C Corporation shares. D Industries shares Totals Cost $ 20 35 15 45 $115 1 Increase 2 Amount Harlon accounts for its equity investment portfolio at fair value through net income. Harlon sold its holdings of A Corporation shares on June 1, 2022, for $15 million. On September 12, it purchased the C Corporation shares. $ 2021 $ 14 Required: 1. What is the effect of the sale of the A Corporation shares and the purchase of the C Corporation shares on Harlon's 2022 pretax $ 35 N/A 46 $95 earnings? 2. At what amount should Harlon's securities equity investment portfolio be reported in its 2022 balance sheet? (For all requirements, enter your answers in millions, (i.e., 10,000,000 should be entered as 10).) 14 50 $101 6 million 5 milion
The summarized statements of financial position of PT ABC and PT DEF as of December 31, 2018 are provided below. If PT ABC acquired a 30% interest in PT DEF on December 31, 2018 for Rp225.000 and the equity method of accounting for the investment were used, the amount of the debit to Equity Investments would have been ?
nit.9
5 MC Questions On 1 July 2019, Peter Limited acquired all the issued shares of Kerri Limited for $100 000 when the equity of Kerri Limited consisted of: Share capital $70 000 Retained earnings 30 000 The pre-acquisition entry at 1 July 2019 is: a. Shares in Kerri Limited Dr 100 000 Retained earnings Cr 30 000 Share capital Cr 70 000 b. Retained earnings Dr 30 000 Share capital Dr 70 000 Shares in Kerri Limited Cr 100 000 c. Retained earnings Dr 70 000 Share capital Dr 30 000 Shares in Kerri Limited Cr 100 000 d. Goodwill Dr 30 000 Share capital Dr 70 000 Shares in Kerri Limited Cr 100 000
QUESTION ONE The following financial information relates to Sporty Limited. Statement of Financial Position as at 31 December 2018 and 2019 Ordinary share capital Retained earnings Property, plant and equipment Investments Debentures 12.5% Inventory Trade debtors Prepaid expenses Trade creditors Bank overdraft SARS (income tax) Shareholders for dividends Profit before interest and tax Depreciation on equipment Dividends received on investments Interest on dividends Income tax Page 2 of 6 2019 R 400 000 55 000 230 000 165 000 20 000 124 000 37 000 Statement of comprehensive income for the year 31 December 2019 Note no. 1 for the year ended 31 December 2018 and 2019 Property, plant and equipment Land and building at cost Equipment at carrying value 25 000 21 000 5 000 30 000 Statement of changes in equity for the year ended 31 December 2019 Dividends on ordinary shares 2019 (R) 200 000 30 000 230 000 R R 295 000 5 000 195 000 110 000 2018 60 000 120 000 28 500 1 500 42 500 25 000 R 60…
Situation 1 Pharoah Tables acquired 15% of the 4,800,000 shares of common stock of Robot Sofas at a total cost of $7.80 per share on April 1, 2025. On August 8, Robot Sofas declared and paid a $267,000 cash dividend. On December 31, Robot Sofas market price was $8.30 per share and the company reported net income of $625,000 for the year. Situation 2 On January 1, 2025, Coronado Company purchased 40% of Santos Corporation 525,000 outstanding shares of common stock at a total cost of $14 per share. On October 25, Santos declared and paid a cash dividend of $0.40 per share. On December 31, Santos reported a net income of $928,000 for the year and the market price of its common stock was $15 per share. Prepare all necessary journal entries in 2025 for both situations. (Credit account titles are automatically Indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries…
1 16 On January 1, 2024, Clor-Proell Enterprises bought 20% of the outstanding common stock of Chen Construction Company for $600 million cash. Chen's net income for the year ended December 31, 2024, was $300 million. During 2024, Chen declared and paid cash dividends of $60 million. Clor-Proell recorded the investment as follows: points PURCHASE General Journal ($ in millions) Debit Credit Investment in Chen Construction shares Cash 600 600 eBook NET INCOME Investment in Chen Construction shares (20% x $300 million) 60 Investment revenue 60 DIVIDENDS Hint Cash (20% x $60 million) 12 Investment in Chen Construction shares 12 Required: Print References What would be the pretax amounts related to the investment that Clor-Proell would report in its statement of cash flows for the year ended December 31, 2024? Note: Enter your answers in millions (i.e., 10,000,000 should be entered as 10). Cash outflows should be indicated with a minus sign. Operating activities $ 600 Investing activities…
Situation 1 Tamarisk Tables acquired 15% of the 5,100,000 shares of common stock of Robot Sofas at a total cost of $8.80 per share on April 1, 2020. On August 8, Robot Sofas declared and paid a $263,000 cash dividend. On December 31, Robot Sofas market price was $9 per share and the company reported net income of $743,000 for the year. The securities are classified as available-for-sale. Situation 2 On January 1, 2020, Vaughn Company purchased 40% of Santos Corporation 465,000 outstanding shares of common stock at a total cost of $13 per share. On October 25, Santos declared and paid a cash dividend of $0.40 per share. On December 31, Santos reported a net income of $934,000 for the year and the market price of its common stock was $14 per share. Prepare all necessary journal entries in 2020 for both situations. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0…

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