i More InfoPurchased 1,000 shares of Microscape stock, paying $52 per share. Theinvestment represents 45% ownership in Microscape's voting stock andRaider has significant influence over Microscape. Raider intends to holdJan. 14 the investment for the indefinite future.Aug. 22 Received a cash dividend of $0.28 per share on the Microscape stock.Dec. 31 Microscape's current market value of $50 per share.Dec. 31 Microscape reported net income of $120,000 for the year ended 2018.PrintDone Raider Investments completed the following transactions during 2018:i (Click the icon to view the transactions.)Requirements1. Journalize Raider's transactions. Explanations are not required.2. Classify and prepare partial financial statements for Raider's 45% Microscape investment for the year ended December31, 2018.Requirement 1. Journalize Raider's transactions. Explanations are not required. (Record debits first, then credits. Excludeexplanations from journal entries. If no entry is required, select "No entry required" on the first line of the Accounts columnand leave the remaining cells blank.)Jan. 14: Purchased 1,000 shares of Microscape stock, paying $52 per share. The investment represents 45% ownership inMicroscape's voting stock and Raider has significant influence over Microscape. Raider intends to hold the investment for theindefinite future.DateAccountsDebitCreditJan. 14

Equity method is used for accounting where investor has 20%-50% stake in ownership of entity. Here,…

Purchased 1,000 shares of Microscape stock, paying $52 per share. The investment represents 45% ownership in Microscape's voting stock and Raider has significant influence over Microscape. Raider intends to hold Jan. 14 the investment for the indefinite future. Aug. 22 Received a cash dividend of $0.28 per share on the Microscape stock. Dec. 31 Microscape's current market value of $50 per share. Dec. 31 Microscape reported net income of $120,000 for the year ended 2018.

Purchased 1,000 shares of Microscape stock, paying $52 per share. The investment represents 45% ownership in Microscape's voting stock and Raider has significant influence over Microscape. Raider intends to hold Jan. 14 the investment for the indefinite future. Aug. 22 Received a cash dividend of $0.28 per share on the Microscape stock. Dec. 31 Microscape's current market value of $50 per share. Dec. 31 Microscape reported net income of $120,000 for the year ended 2018.

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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Case A: On January 1, 2021, your company purchased 60,000 shares of Freeze Company's $10 par common stock for $26 per share in cash plus paid $10,000 of broker's fees. On that date, Freeze Company's assets and liabilities had a book value equal to market value except for their building which had a market value which was $80,000 higher than its book value and had a 20-year remaining life. 2021 a. Purchased 60,000 shares of Freeze Company's $10 par common stock for $26 per share in cash plus paid $10,000 in broker's fees.. b. Received $30,000 in cash dividends. On December 31, 2021: 1. Freeze Company's stock had a market value of $25 per share. с. 2. Freeze Company reported net income of $400,000. 2022 d. Received a 10% stock dividend. On December 31, 2022: 1. Freeze Company's stock had a market value of $24 per share. е. 2. Freeze Company reported net income of $500,000. Assume the 60,000 shares you purchased represented 30% of the outstanding shares of Freeze Company so you were using…
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