On April 1, 2025, Promise Company purchased 150,000 common shares in Delta Co. for $7 per share. The total number of common shares outstanding for Delta Co is 3.1 million. The management of Promise Co. needs to store itS cash in an investment and it believes that the market will eventually recover in a couple years and it might sell at that time. Delta Co. paid no dividends during the year and on December 31, 2025 its shares were trading at $6.65 per share. Management does not view investing as part of its operations.

On April 1, 2025, Promise Company purchased 150,000 common shares in Delta Co. for $7 per share. The total number of common shares outstanding for Delta Co is 3.1 million. The management of Promise Co. needs to store itS cash in an investment and it believes that the market will eventually recover in a couple years and it might sell at that time. Delta Co. paid no dividends during the year and on December 31, 2025 its shares were trading at $6.65 per share. Management does not view investing as part of its operations.

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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