Required information[The following information applies to the questions displayed below.]On January 2, 2024, Sanborn Tobacco Incorporated bought 5% of Jackson Industry's capital stock for $92 million. JacksonIndustry's net income for the year ended December 31, 2024, was $122 million. The fair value of the shares held bySanborn was $102 million at December 31, 2024. During 2024, Jackson declared a dividend of $62 million.2. Assume that Sanborn sold the stock on January 2, 2025 for $114 million. Prepare the journal entries Sanborn would use to recordthe sale.Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answersin millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5).View transaction listJournal entry worksheet<12Record the entry to adjust to fair value on the date of sale.Note: Enter debits before credits.Transaction1Record entryGeneral JournalClear entryDebitCreditView general journal>

A corporation may invest in another company's shares, which are typically accounted for using the…

Answered: ! Required information [The following…

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 14RE

See similar textbooks

Similar questions

Hyde Corporations capital structure at December 31, 2018, was as follows: On July 2, 2019, Hyde issued a 10% stock dividend on its common stock and paid a cash dividend of 2.00 per share on its preferred stock. Net income for the year ended December 31, 2019, was 780,000. What should be Hydes 2019 basic earnings per share? a. 7.80 b. 7.09 c. 7.68 d. 6.73
On January 1, 2019, Kittson Company had a retained earnings balance of 218,600. It is subject to a 30% corporate income tax rate. During 2019, Kittson earned net income of 67,000, and the following events occurred: 1. Cash dividends of 3 per share on 4,000 shares of common stock were declared and paid. 2. A small stock dividend was declared and issued. The dividend consisted of 600 shares of 10 par common stock. On the date of declaration, the market price of the companys common stock was 36 per share. 3. The company recalled and retired 500 shares of 100 par preferred stock. The call price was 125 per share; the stock had originally been issued for 110 per share. 4. The company discovered that it had erroneously recorded depreciation expense of 45,000 in 2018 for both financial reporting and income tax reporting. The correct depreciation for 2018 should have been 20,000. This is considered a material error. Required: 1. Prepare journal entries to record Items 1 through 4. 2. Prepare Kittsons statement of retained earnings for the year ended December 31, 2019.
The following information applies to the questions displayed below.] On January 2, 2024, Sanborn Tobacco Incorporated bought 5% of Jackson Industry's capital stock for $96 million. Jackson Industry's net income for the year ended December 31, 2024, was $ 126 million. The fair value of the shares held by Sanborn was $110 million at December 31, 2024. During 2024, Jackson declared a dividend of $66 million. 1. Prepare all appropriate journal entries related to the investment during 2024. Journal entry worksheet a- Record the purchase of Jackson Industry capital stock for $96 million. b Record Sanborn Tobacco's portion of Jackson Industry's net income of $126 million. c- Record the dividend revenue. d - Record the fair value adjustment. 2. Assume that Sanborn sold the stock on January 2, 2025 for $122 million. Prepare the journal entries Sanborn would use to record the sale. a - Record the entry to adjust to fair value on the date of sale. b Record the sale of stock on January 2, 2025 for…
Please help me
Toy Co Corporation purchased 282,000 of the 940,000 common shares of Abacus Ltd. on October 1, 2021, at $2.10 per share. Near the end of the fourth quarter ended on December 29th, Abacus declared dividends on its common shares of $74,000 but the dividend payment date is not until 2022. Abacus also announced that it had net income for the quarter ended December 31, 2021, of $188,000.Record the journal entries that Toy Co would make during the last quarter ended December 31, 2021, under the following assumptions: Toy Co does not have significant influence over Abacus and uses the cost model to account for this investment. (List all debit entries before credit entries. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Please donot provide solution in image format provide solution in step by step format with fast solution
On January 2, 2021, Sanborn Tobacco Inc. bought 5% of Jackson Industry’s capital stock for $90 million. Jackson Industry’s net income for the year ended December 31, 2021, was $120 million. The fair value of the shares held by Sanborn was $98 million at December 31, 2021. During 2021, Jackson declared a dividend of $60 million.Required:1. Prepare all appropriate journal entries related to the investment during 2021.2. Assume that Sanborn sold the stock on January 2, 2022 for $110 million. Prepare the journal entry Sanborn would use to record the sale.
On March 31, 2024, Chow Brothers, Incorporated, bought 6% of KT Manufacturing's capital stock for $55.4 million. KT's net income for the year ended December 31, 2024, was $81.8 million. The fair value of the shares held by Chow was $38.6 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 $31.8 million. Prepare the journal entries to record the sale. Complete this question by entering your answers in the tabs below. Required 1 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 Required 2 Journal entry worksheet
On March 31, 2024, Chow Brothers, Incorporated, bought 7% of KT Manufacturing’s capital stock for $51.2 million. KT’s net income for the year ended December 31, 2024, was $80.4 million. The fair value of the shares held by Chow was $35.8 million at December 31, 2024. KT did not declare or pay a dividend during 2024. Required: Prepare all appropriate journal entries related to the investment during 2024. Assume that Chow sold the stock on January 20, 2025, for $30.4 million. Prepare the journal entries to record the sale.
On June 1, 2024, Blue Company distributed to its common stockholders 140,000 outstanding common shares of its investment in Red Incorporated which is an unrelated party. The book value on Blue’s books of Red's $1 par common stock was $1.40 per share. Immediately after the declaration, the market price of Red's stock was $2.90 per share. In its income statement for the year ended June 30, 2024, what amount should Blue report as gain before income taxes on disposal of the stock?
On January 1, 2021, MNO Company acquired 12,500 of the outstanding common shares of Esther Corporation stocks at P40 per share. Esther Corp. had a total of 62,500 shares outstanding on the same date. Esther Corp. declared total dividends of P20,000 to shareholders on December 20, 2021 and reported a net income of P150,000 for 2021. What is the amount of dividend income to be presented in profit or loss for the year ended December 31, 2021? 5.
On January 1, 2023, EE Company acquired 70,000 shares, representing 20% of the outstanding shares of WW Limited, at a price of $10 per share. On July 31, 2023, WW declared and paid a dividend of $1 per share. WW's net income for 2023 was $1,250,000. On December 31, 2023, the shares of WW were trading on the Toronto Stock Exchange at $14 per share. Required EE is not sure how to report its investment in WW shares. Using the following format, indicate the amounts that would appear on the balance sheet and the statement of comprehensive income for 2023 if the investment (a) has been irrevocably elected to be measured at fair value through OCI, (b) is classified as FVPL, or (c) is an associate. Complete the balance sheet in the following table. (For entries with a $0 balance, make sure to enter "0" in the appropriate column.) Balance sheet Investment in WW shares Fair value through OCI election FVPL Associate
Hobson Company bought 20,500 shares of the voting common stock of Fizer Pharmaceutical in January 2022. In December, Fizer announced $202,300 net income for 2022 and declared and paid a cash dividend of $7.00 per share on all 209,500 shares of its outstanding common stock. Hobson Company's dividend revenue from Fizer Pharmaceutical in December 2022 would be: Multiple Choice $143,500. None of these answer choices are correct. $ 0. $19,795.

SEE MORE QUESTIONS

Recommended textbooks for you

Intermediate Accounting: Reporting And Analysis

Accounting

ISBN:

9781337788281

Author:

James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:

Cengage Learning

Cornerstones of Financial Accounting

Accounting

ISBN:

9781337690881

Author:

Jay Rich, Jeff Jones

Publisher:

Cengage Learning

Intermediate Accounting: Reporting And Analysis

Accounting

ISBN:

9781337788281

Author:

James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:

Cengage Learning

Cornerstones of Financial Accounting

Accounting

ISBN:

9781337690881

Author:

Jay Rich, Jeff Jones

Publisher:

Cengage Learning

SEE MORE TEXTBOOKS