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Grouper Co. had purchased 190 shares of Washington Co. for $43 each this year (Oregon Co. does not have significant influence). Grouper Co. sold 95 shares of Washington Co. stock for $48 each. At year-end, the price per share of the Washington Co. stock had dropped to $37. Prepare the journal entries for these transactions and any year-end adjustments. (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 O for the amounts.) Account Titles and Explanation Debit Credit Equity Investments 8170 Cash 8170 (To record the purchase.) Cash 4560 Equity Investments 4085 Gain on Sale of Investments 475 (To record the sale.) No Entry No Entry (To record the fair value.)

Grouper Co. had purchased 190 shares of Washington Co. for $43 each this year (Oregon Co. does not have significant influence). Grouper Co. sold 95 shares of Washington Co. stock for $48 each. At year-end, the price per share of the Washington Co. stock had dropped to $37. Prepare the journal entries for these transactions and any year-end adjustments. (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 O for the amounts.) Account Titles and Explanation Debit Credit Equity Investments 8170 Cash 8170 (To record the purchase.) Cash 4560 Equity Investments 4085 Gain on Sale of Investments 475 (To record the sale.) No Entry No Entry (To record the fair value.)

FINANCIAL ACCOUNTING
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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ENTERED AS NO ENTRY AND WHERE MARKED WRONG.

LIST OF ACCOUNTS

  • Accumulated Other Comprehensive Loss
  • Allowance for Doubtful Accounts
  • Allowance to Reduce Inventory to Market
  • Bad Debt Expense
  • Bonds Payable
  • Cash
  • Call Option
  • Common Stock
  • Cost of Goods Sold
  • Debt Investments
  • Dividend Revenue
  • Dividend Receivable
  • Equity Investments
  • Fair Value Adjustment
  • Futures Contract
  • Gain on Sale of Investments
  • Gain on Settlement of Call Option
  • Gain on Settlement of Put Option
  • Interest Expense
  • Interest Receivable
  • Interest Revenue
  • Inventory
  • Investment Income
  • Loss on Impairment
  • Loss on Sale of Investments
  • Loss on Settlement of Call Option
  • Loss on Settlement of Put Option
  • No Entry
  • Notes Payable
  • Paid-in Capital in Excess of Par - Common Stock
  • Put Option
  • Recovery of Loss from Impairment
  • Retained Earnings
  • Revenue from Investment
  • Sales Revenue
  • Swap Contract
  • Unrealized Holding Gain or Loss - Equity
  • Unrealized Holding Gain or Loss - Income

 

**Transaction Analysis for Grouper Co.** Grouper Co. engaged in the following transactions involving Washington Co. stock: 1. **Purchase of Shares:** - **Shares Purchased:** 190 shares at $43 each. - **Transaction Details:** - **Debit (Equity Investments):** $8,170 - **Credit (Cash):** $8,170 - **Explanation:** To record the purchase of equity investments. 2. **Sale of Shares:** - **Shares Sold:** 95 shares at $48 each. - **Transaction Details:** - **Debit (Cash):** $4,560 - **Credit (Equity Investments):** $4,085 - **Credit (Gain on Sale of Investments):** $475 - **Explanation:** To record the sale of equity investments. 3. **Year-End Adjustment:** - **Market Price Change:** The price per share dropped to $37. - **Transaction Details:** - **No Entry Required** _Note: Credit account titles are automatically indented when the amount is entered. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts._
Transcribed Image Text:**Transaction Analysis for Grouper Co.** Grouper Co. engaged in the following transactions involving Washington Co. stock: 1. **Purchase of Shares:** - **Shares Purchased:** 190 shares at $43 each. - **Transaction Details:** - **Debit (Equity Investments):** $8,170 - **Credit (Cash):** $8,170 - **Explanation:** To record the purchase of equity investments. 2. **Sale of Shares:** - **Shares Sold:** 95 shares at $48 each. - **Transaction Details:** - **Debit (Cash):** $4,560 - **Credit (Equity Investments):** $4,085 - **Credit (Gain on Sale of Investments):** $475 - **Explanation:** To record the sale of equity investments. 3. **Year-End Adjustment:** - **Market Price Change:** The price per share dropped to $37. - **Transaction Details:** - **No Entry Required** _Note: Credit account titles are automatically indented when the amount is entered. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts._
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