Chapter 15Investments and Fair Value Accounting713EX 15-11Equity method for stock investment0On January 4, 2016, Spandella Company purchased 175,000 shares of Filington CompanyOBJ. 3directly from one of the founders for a price of $30 per share. Filington has 500,000shares outstanding, including the Penman shares. On July 2, 2016, Filington paid $620,000in total dividends to its shareholders. On December 31, 2016, Filington reported a netincome of $1,050,000 for the year. Spandella uses the equity method in accounting forits investment in Filington.a. Provide the Spandella Inc. journal entries for the transactions involving its investmentin Filington Inc. during 2016.b.Determine the December 31, 2016, balance of the Investment in Filington Company.Stock account.OBJ.3Bulldog Co. purchased 34% of the outstanding stock of Gator Co.all shareholders on June 30.EX 15-12Equity method for stock investment with loss

a. Record journal entries for the transactions of investment in Filington as shown below:

Answered: Chapter 15 Investments and Fair Value…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Problem 1Q

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Investment in Equity Kalvin Co. acquired 15% of the 5,000,000 shares of common stock of Tops Co. at a cost of $8.50 per share on January 1, 2017. Tops Co. declared and paid a $250,000 cash dividend and reported net income of $685,000 for the year. On January 2, 2018, Kalvin sold these shares at a market price of $9.00 per share. Required: Prepare all necessary journal entries for 2017 and 2018.
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11:36 Today All Photos 11:36 PM More Info Purchased 500 shares of Voltexar stock, paying $49 per share. The investment represents 4% ownership in Voltexar's voting stock. Raider does not have significant influence over Voltexar. Raider intends to hold the investment for the Jan. 14 indefinite future. Aug. 22 Received a cash dividend of $0.32 per share on the Voltexar stock. Dec. 31 Adjusted the Voltexar investment to its current market value of $54. Print Done Edit
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Situation 1Waterway Cosmetics acquired 10% of the 189,000 shares of common stock of Martinez Fashion at a total cost of $12 per share on March 18, 2020. On June 30, Martinez declared and paid $77,300 cash dividend to all stockholders. On December 31, Martinez reported net income of $122,300 for the year. At December 31, the market price of Martinez Fashion was $13 per share.Situation 2Wildhorse, Inc. obtained significant influence over Seles Corporation by buying 30% of Seles’s 32,100 outstanding shares of common stock at a total cost of $9 per share on January 1, 2020. On June 15, Seles declared and paid cash dividends of $32,700 to all stockholders. On December 31, Seles reported a net income of $78,800 for the year.Prepare all necessary journal entries in 2020 for both situations.
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QUESTION 20 The shareholders' equity section of Jason Company as of December 31, 2017, was as follows: Common stock $180,000 Additional paid-in capital (Common stock) 110,000 Retained earnings 160,000 Total shareholders' equity $450,000 . On January 15, the company repurchased 1,500 shares of its own common stock at $60 to hold as treasury stock. Which of the following would be included in the journal entry recorded on January 15? A credit to Retained Earnings for $90,000 A debit to Cash for $90,000 A debit to Treasury Stock for $90,000 A debit to Common Stock for $90,000 None of these choices is correct.

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