Rose Company had no short-term investments prior to this year. It had the following transactions this year involving short-term stock investments with insignificant influence.April 16Purchased 3,500 shares of Gem Company stock at $24 per share.July 7Purchased 2,000 shares of PepsiCo stock at $49 per share.July 20Purchased 1,000 shares of Xerox stock at $16 per share.August 15Received a $1.00 per share cash dividend on the Gem Company stock.August 28Sold 2,000 shares of Gem Company stock at $30 per share.October 1Received a $2.50 per share cash dividend on the PepsiCo shares.December 15Received a $1.00 per share cash dividend on the remaining Gem Company shares.December 31Received a $1.50 per share cash dividend on the PepsiCo shares.The year-end fair values per share are Gem Company, $26; PepsiCo, $46; and Xerox, $13.4. Prepare the current asset section of the balance sheet for the fair value adjustment for Rose’s short-term investments.

Cost of the share is the price at which the shares are purchased. Fair value of the share is the…

Answered: Rose Company had no short-term…

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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Rose Company had no short-term investments prior to this year. It had the following transactions this year involving short-term stock investments with insignificant influence.

April 16	Purchased 3,500 shares of Gem Company stock at $24 per share.
July 7	Purchased 2,000 shares of PepsiCo stock at $49 per share.
July 20	Purchased 1,000 shares of Xerox stock at $16 per share.
August 15	Received a $1.00 per share cash dividend on the Gem Company stock.
August 28	Sold 2,000 shares of Gem Company stock at $30 per share.
October 1	Received a $2.50 per share cash dividend on the PepsiCo shares.
December 15	Received a $1.00 per share cash dividend on the remaining Gem Company shares.
December 31	Received a $1.50 per share cash dividend on the PepsiCo shares.

The year-end fair values per share are Gem Company, $26; PepsiCo, $46; and Xerox, $13.

4. Prepare the current asset section of the balance sheet for the fair value adjustment for Rose’s short-term investments.

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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