es On March 31, 2024, Chow Brothers, Incorporated, bought 6% of KT Manufacturing's capital stock for $54.8 million. KT's net income for the year ended December 31, 2024, was $81.6 million. The fair value of the shares held by Chow was $38.2 million at December 31, 2024. KT did not declare or pay a dividend during 2024. Required: 1. Prepare all appropriate journal entries related to the investment during 2024. 2. Assume that Chow sold the stock on January 20, 2025, for $31.6 million. Prepare the journal entries to record the sale. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare all appropriate journal entries related to the investment during 2024. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5), View transaction list Journal entry worksheet 1 2 3 Record the entry for KT's net income. Note: Enter debits before credits. Date General Journal Debit Credit December 31, Gain on investments (NI) 2024 Fair value adjustment Prov
es On March 31, 2024, Chow Brothers, Incorporated, bought 6% of KT Manufacturing's capital stock for $54.8 million. KT's net income for the year ended December 31, 2024, was $81.6 million. The fair value of the shares held by Chow was $38.2 million at December 31, 2024. KT did not declare or pay a dividend during 2024. Required: 1. Prepare all appropriate journal entries related to the investment during 2024. 2. Assume that Chow sold the stock on January 20, 2025, for $31.6 million. Prepare the journal entries to record the sale. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare all appropriate journal entries related to the investment during 2024. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5), View transaction list Journal entry worksheet 1 2 3 Record the entry for KT's net income. Note: Enter debits before credits. Date General Journal Debit Credit December 31, Gain on investments (NI) 2024 Fair value adjustment Prov
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
ChapterA2: Investments
Section: Chapter Questions
Problem 25E
Related questions
Question
![es
On March 31, 2024, Chow Brothers, Incorporated, bought 6% of KT Manufacturing's capital stock for $54.8 million. KT's net income for
the year ended December 31, 2024, was $81.6 million. The fair value of the shares held by Chow was $38.2 million at December 31,
2024. KT did not declare or pay a dividend during 2024.
Required:
1. Prepare all appropriate journal entries related to the investment during 2024.
2. Assume that Chow sold the stock on January 20, 2025, for $31.6 million. Prepare the journal entries to record the sale.
Complete this question by entering your answers in the tabs below.
Required 1
Required 2
Prepare all appropriate journal entries related to the investment during 2024.
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in
millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5),
View transaction list
Journal entry worksheet
1
2
3
Record the entry for KT's net income.
Note: Enter debits before credits.
Date
General Journal
Debit
Credit
December 31, Gain on investments (NI)
2024
Fair value adjustment
Prov](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F0a7e174b-2c76-418b-9b3a-db29dc3517e9%2Fd38f571d-a012-46da-ba5b-bfba855dd228%2Fgi76ba_processed.jpeg&w=3840&q=75)
Transcribed Image Text:es
On March 31, 2024, Chow Brothers, Incorporated, bought 6% of KT Manufacturing's capital stock for $54.8 million. KT's net income for
the year ended December 31, 2024, was $81.6 million. The fair value of the shares held by Chow was $38.2 million at December 31,
2024. KT did not declare or pay a dividend during 2024.
Required:
1. Prepare all appropriate journal entries related to the investment during 2024.
2. Assume that Chow sold the stock on January 20, 2025, for $31.6 million. Prepare the journal entries to record the sale.
Complete this question by entering your answers in the tabs below.
Required 1
Required 2
Prepare all appropriate journal entries related to the investment during 2024.
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in
millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5),
View transaction list
Journal entry worksheet
1
2
3
Record the entry for KT's net income.
Note: Enter debits before credits.
Date
General Journal
Debit
Credit
December 31, Gain on investments (NI)
2024
Fair value adjustment
Prov
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