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Required: (a) Prepare the journal entries recorded by Ahmed for its investments in Gander during Year 6. (Mf transaction/event, select "No journal entry required" in the first account field.) View transaction list A Record the purchase of Gander shares. B Record the dividends on preferred shares from Gander. c Record the equity-method income. D Record the dividends from Gander. EXI >

Required: (a) Prepare the journal entries recorded by Ahmed for its investments in Gander during Year 6. (Mf transaction/event, select "No journal entry required" in the first account field.) View transaction list A Record the purchase of Gander shares. B Record the dividends on preferred shares from Gander. c Record the equity-method income. D Record the dividends from Gander. EXI >

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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Please help me to correct the wrong answers, thanks a lot! Ahmed Corporation purchased 75 percent of Gander Company's common shares and 40 percent of its preferred shares on January 1, Year 6, for $540,000 and $160,000, respectively. At the time of purchase, the fair value of Gander's common and preferred shares was equal to their carrying value. Gander's balance sheet contained the following balances: Preferred Shares ($10 par value) Common Shares Retained Earnings Total Shareholders' Equity Show Transcribed Text For the year ended December 31, Year 6, Gander reported net income of $140,000 and paid dividends of $52,000 (which includes the preferred dividend). The preferred shares are cumulative and pay an annual dividend of 4 percent. There were no dividends in arrears at the date of acquisition. Ahmed uses the cost method to account for its interest in the preferred shares of Gander and the equity method to account for its interest in the common shares of Gander. View transaction list A Record the purchase of Gander shares. 400,000 300,000 420,000 $ 1,120,000 Required: (a) Prepare the journal entries recorded by Ahmed for its investments in Gander during Year 6. (11 transaction/event, select "No journal entry required" in the first account field.) $ с Record the equity-method income. Ć B Record the dividends on preferred shares from Gander. D Record the dividends from Gander. :X: >
Transcribed Image Text:Please help me to correct the wrong answers, thanks a lot! Ahmed Corporation purchased 75 percent of Gander Company's common shares and 40 percent of its preferred shares on January 1, Year 6, for $540,000 and $160,000, respectively. At the time of purchase, the fair value of Gander's common and preferred shares was equal to their carrying value. Gander's balance sheet contained the following balances: Preferred Shares ($10 par value) Common Shares Retained Earnings Total Shareholders' Equity Show Transcribed Text For the year ended December 31, Year 6, Gander reported net income of $140,000 and paid dividends of $52,000 (which includes the preferred dividend). The preferred shares are cumulative and pay an annual dividend of 4 percent. There were no dividends in arrears at the date of acquisition. Ahmed uses the cost method to account for its interest in the preferred shares of Gander and the equity method to account for its interest in the common shares of Gander. View transaction list A Record the purchase of Gander shares. 400,000 300,000 420,000 $ 1,120,000 Required: (a) Prepare the journal entries recorded by Ahmed for its investments in Gander during Year 6. (11 transaction/event, select "No journal entry required" in the first account field.) $ с Record the equity-method income. Ć B Record the dividends on preferred shares from Gander. D Record the dividends from Gander. :X: >
Required: (a) Prepare the journal entries recorded by Ahmed for its investments in Gander during Year 6. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No A B C D Transaction 1 2 3 4 Investment in Gander preferred shares Cash Investment in Gander common shares Cash Cash Dividend income Cash Show Transcribed Text > Answer is not complete. General Journal Dividend income ✓ X Non-controlling interest's share of net income Non-controlling interest on the balance sheet X X X X ✓ X Debit 160,000 $ 35000 $ 280000 540,000 6,400x 27,000✔ Credit 160,000 X 540.000 X 6,400 X (b) Calculate non-controlling interest's share of net income and non-controlling interest on the balance sheet for the Year 6 consolidated financial statements. (Omit $ sign in your response.) 27,000✔
Transcribed Image Text:Required: (a) Prepare the journal entries recorded by Ahmed for its investments in Gander during Year 6. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No A B C D Transaction 1 2 3 4 Investment in Gander preferred shares Cash Investment in Gander common shares Cash Cash Dividend income Cash Show Transcribed Text > Answer is not complete. General Journal Dividend income ✓ X Non-controlling interest's share of net income Non-controlling interest on the balance sheet X X X X ✓ X Debit 160,000 $ 35000 $ 280000 540,000 6,400x 27,000✔ Credit 160,000 X 540.000 X 6,400 X (b) Calculate non-controlling interest's share of net income and non-controlling interest on the balance sheet for the Year 6 consolidated financial statements. (Omit $ sign in your response.) 27,000✔
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