Entries for equity investment of between 20%–50% ownership Glacier Products Inc. is a wholesaler of rock climbing gear. The company began operations on January 1, 20Y3. The following transactions relate to securities acquired by Glacier Products Inc., which has a fiscal year ending on December 31, 20Y3: 20Y3 Jan. 25 Purchased 44,000 shares of Helsi Co. common stock for $760,000. There are 110,000 shares of Helsi Co. stock outstanding. Dec. 31 Received $23,000 of cash dividends on Helsi Co. stock. Helsi Co. reported net income of $95,000 in 20Y3. Required: 1. Journalize the entries to record the preceding transactions. If an amount box does not require an entry, leave it blank. 2. Should Glacier Product Inc.’s investment in Helsi Co. be reported at fair value on its financial statements for the year ending December 31, 20Y3?
Entries for equity investment of between 20%–50% ownership Glacier Products Inc. is a wholesaler of rock climbing gear. The company began operations on January 1, 20Y3. The following transactions relate to securities acquired by Glacier Products Inc., which has a fiscal year ending on December 31, 20Y3: 20Y3 Jan. 25 Purchased 44,000 shares of Helsi Co. common stock for $760,000. There are 110,000 shares of Helsi Co. stock outstanding. Dec. 31 Received $23,000 of cash dividends on Helsi Co. stock. Helsi Co. reported net income of $95,000 in 20Y3. Required: 1. Journalize the entries to record the preceding transactions. If an amount box does not require an entry, leave it blank. 2. Should Glacier Product Inc.’s investment in Helsi Co. be reported at fair value on its financial statements for the year ending December 31, 20Y3?
Financial Accounting
14th Edition
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Carl Warren, Jim Reeve, Jonathan Duchac
Chapter15: Investments And Fair Value Accounting
Section: Chapter Questions
Problem 3PB
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Entries for equity investment of between 20%–50% ownership
Glacier Products Inc. is a wholesaler of rock climbing gear. The company began operations on January 1, 20Y3. The following transactions relate to securities acquired by Glacier Products Inc., which has a fiscal year ending on December 31, 20Y3:
20Y3
Jan. 25 | Purchased 44,000 shares of Helsi Co. common stock for $760,000. There are 110,000 shares of Helsi Co. stock outstanding. |
Dec. 31 | Received $23,000 of cash dividends on Helsi Co. stock. Helsi Co. reported net income of $95,000 in 20Y3. |
Required:
1.
2. Should Glacier Product Inc.’s investment in Helsi Co. be reported at fair value on its financial statements for the year ending December 31, 20Y3?
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