c-1. Prior to making a mark-to-market adjustment at the end of year 2, determine the unadjusted balance in the MarketableSecurities control account.c-2 Prior to making a mark-to-market adjustment at the end of year 2, determine the Unrealized Holding Gain (or Loss) onInvestments account.d. Prepare a schedule showing the cost and the market values of securities owned at the end of year 2.e. Prepare the fair value adjusting entry required at December 31, year 2.f-1. Calculate the amount of marketable securities in the financial statements at December 31, year 2.f-2. Calculate the amount of unrealized holding gain (or loss) in the financial statements at December 31, year 2.g. Illustrate the presentation of the net realized gains (or losses) in the year 2 income statement. Assume a multiple-step inconstatement and show the caption identifying the section in which this amount would appear.Complete this question by entering your answers in the tabs below.Req A1Reg A2Req BReq C1< PrevETHERReg C23 of 3Req DReq ENextTHERReq F1Req F2Req G sec iSavedL Brands, Inc. (5,000 shares: cost, $44 per share; market value, $52)The Gap, Inc. (4,000 shares: cost, $42 per share; market value, $39)wcon...Cost$ 220,000168,000$ 388,000Help Save & ExitCurrentMarketValue$ 260,000156,000$ 416,000In year 2, Charter engaged in the following two transactions.Apr.10 Sold 1,000 shares of its investment in L Brands, Inc., at a price of $58 per share, less a brokerage commission of$100.☆SAug. 7 Sold 2,000 shares of its investment in The Gap, Inc., at a price of $37 per share, less a brokerage commission of$150.At December 31, year 2, the market values of these stocks were: L Brands, Inc., $67 per share; and The Gap, Inc., $37 per share.

Note: Hi! Thank you for the question, As per the honor code, we are allowed to answer three…

Saved L Brands, Inc. (5,000 shares: cost, $44 per share; market value, $52) The Gap, Inc. (4,000 shares: cost, $42 per share; market value, $39) Help Current Market Cost $ 220,000 168,000 Value $ 260,000 156,000 $ 388,000 $ 416,000 Save & Exit In year 2, Charter engaged in the following two transactions. Apr.10 Sold 1,000 shares of its investment in L Brands, Inc., at a price of $58 per share, less a brokerage commission of $100. Aug. 7 Sold 2,000 shares of its investment in The Gap, Inc., at a price of $37 per share, less a brokerage commission of $150. At December 31, year 2, the market values of these stocks were: L Brands, Inc., $67 per share; and The Gap, Inc., $37 per shar-

Saved L Brands, Inc. (5,000 shares: cost, $44 per share; market value, $52) The Gap, Inc. (4,000 shares: cost, $42 per share; market value, $39) Help Current Market Cost $ 220,000 168,000 Value $ 260,000 156,000 $ 388,000 $ 416,000 Save & Exit In year 2, Charter engaged in the following two transactions. Apr.10 Sold 1,000 shares of its investment in L Brands, Inc., at a price of $58 per share, less a brokerage commission of $100. Aug. 7 Sold 2,000 shares of its investment in The Gap, Inc., at a price of $37 per share, less a brokerage commission of $150. At December 31, year 2, the market values of these stocks were: L Brands, Inc., $67 per share; and The Gap, Inc., $37 per shar-

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Current Attempt in Progress These are two independent situations: 1. Pharoah Cosmetics acquired 13%…

A: When an investor acquires between 20% to 50% of the outstanding stocks of an investee company, then…

Q: i need solution :

A: The objective of the question is to prepare general journal entries to record each transaction for…

Q: How much is the cost of investment? * On January 31. 2022. Parent Company purchased al the…

A: SOLUTION COST OF INVESTMENT MEANS CONTRACT PURCHASE PRICE OF INVESTMENTS ACQUIRED , ACQUISITION…

Q: Prepare all necessary journal entries in 2020 for both situations with the date and account title by…

A: Situation 1: Date Account Titles and Explanations Debit Credit March 18, 2020…

Q: Quan Corp. manufactures construction equipment. Feb. 2 Purchased for cash 3,100 shares of Celeste…

A: Journal Entry Date Particulars Amount (Dr) ($) Amount (Cr) ($) Feb-02 Investments in Celeste…

Q: Cosmos Corporation had the following long-term investment transactions. Year 1 January 2 Purchased…

A: Solution: journal entries Cosmos Corporation should record for these transactions and events are as…

Q: A corporation purchased 1,000 shares of its own $5 par common stock at $10 and subsequently sold 500…

A: Revenue is the total amount realized from selling the said number of shares. Shares are the…

Q: Harvatin Group reported net income totaling $1,000,000 for the year 2006. The following is EXERCISE…

A: Comprehensive Income: The change that occurs in equity of a company from other events,…

Q: On January 15 of the current year, Thomas Company purchased 2,800 shares of Dillon Company at a…

A: The income ( loss ) is the difference between the total sales price and the total cost of the…

Q: Crane Corporation had net sales of $2,417,100 and interest revenue of $37,500 during 2025. Expenses…

A: Financial statements are those statements which are prepared at the end of accounting period. Under…

Q: Successfully signed in as vipulkumarmakwana8801. X Stock $14,000, debtors $20,000, creditors…

A: To find the total assets of the firm, we need to use the given information and ratios to calculate…

Q: On January 1, Tasty Foods purchased 3,000 shares (30%) of Eco-Safe Packaging’s voting stock for $12…

A: Equity method of investment: It can be defined as the method that is used by the investors for…

Q: On February 2, 10X1, Solo Company purchased 900 shares of Red Corp. Red Corp has a total of 6,000…

A: Purchase price = 900x 32 =28800 brokerage =2% x 28800= 576 losson ssle of shares =(28x100)-(32x100)…

Q: o Company purchased 40% of the outstanding stock of Marco Company on January 1. Marco reported net…

A: This strategy is only employed when the investor has sufficient control over the investee. The…

Q: ne profit. A&B Co. started operations on April 1, 20x1. Mr. A, a partner in A&B Co., is entitled to…

A: Assuming year ends on 31 st March 20x2 in order to get 12 months

Q: The following are two independent situations. Situation 1 Metlock Cosmetics acquired 10% of the…

A: Date Particular Debit Credit Situation 1: Metlock Cosmetics Mar 18 Available for sale…

Q: 1. Prepare closing entries. 2. Compare final closing entry to net income. Explain why the dollar…

A: Net Income is the net which business has earned during the period after deducting all expenses.…

Q: Situation 1: Carla Cosmetics acquired 10% of the 189,000 shares of common stock of Martinez Fashion…

A: A journal entry records a business transaction in the accounting system for an organization. Journal…

Q: On February 22, Triangle Corporation acquired 2,700 shares of the 95,000 outstanding common stock of…

A: Accounting for investment is the process of journalising the transactions occurred due to…

Q: Pizza Corporation acquired 80 percent ownership of Slice Products Company on January 1, 20X1, for…

A: Journal entries are the first step of keeping records of business transactions in books of accounts…

Q: On January 1, Bonneau Corp purchased 90,000 shares of Crossley, Inc stock for $50 each. Crossley has…

A: The investment is reported as the assets in the business. The dividend share decreases the…

Q: On January 1, Ivanhoe Corporation purchased a 25% equity in Helbert Corporation for $152,000. At…

A: Investment in Helbert, December 31 = Stock Investments cost + Share of net income - Dividends…

Q: JE 1 PizzaPan Inc. sold 1 million shares of their common stock for $1/share (par value of the…

A: T Account: T account is the graphical representation of general ledger which is used to record the…

Q: Ramiro Company purchased 40% of the outstanding stock of Marco Company on January 1. Marco reported…

A: The share in net income is to be added to amount of investment

Concept explainers

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.

Question

100%

c-1. Prior to making a mark-to-market adjustment at the end of year 2, determine the unadjusted balance in the Marketable
Securities control account.
c-2 Prior to making a mark-to-market adjustment at the end of year 2, determine the Unrealized Holding Gain (or Loss) on
Investments account.
d. Prepare a schedule showing the cost and the market values of securities owned at the end of year 2.
e. Prepare the fair value adjusting entry required at December 31, year 2.
f-1. Calculate the amount of marketable securities in the financial statements at December 31, year 2.
f-2. Calculate the amount of unrealized holding gain (or loss) in the financial statements at December 31, year 2.
g. Illustrate the presentation of the net realized gains (or losses) in the year 2 income statement. Assume a multiple-step incon
statement and show the caption identifying the section in which this amount would appear.
Complete this question by entering your answers in the tabs below.
Req A1
Reg A2
Req B
Req C1
< Prev
ETHER
Reg C2
3 of 3
Req D
Req E
Next
THER
Req F1
Req F2
Req G

sec i
Saved
L Brands, Inc. (5,000 shares: cost, $44 per share; market value, $52)
The Gap, Inc. (4,000 shares: cost, $42 per share; market value, $39)
wcon...
Cost
$ 220,000
168,000
$ 388,000
Help Save & Exit
Current
Market
Value
$ 260,000
156,000
$ 416,000
In year 2, Charter engaged in the following two transactions.
Apr.10 Sold 1,000 shares of its investment in L Brands, Inc., at a price of $58 per share, less a brokerage commission of
$100.
☆
S
Aug. 7 Sold 2,000 shares of its investment in The Gap, Inc., at a price of $37 per share, less a brokerage commission of
$150.
At December 31, year 2, the market values of these stocks were: L Brands, Inc., $67 per share; and The Gap, Inc., $37 per share.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

Step 2

Step 3

Step 4

Trending now

This is a popular solution!

Step by step

Solved in 4 steps with 3 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

H1.
please prepare the journal entries Q1. Sold 22,500 Treasury shares at $2 each. Q2. Purchased 10% shareholding in Charlie Limited, a supplier, as a long-term investment. The fair value of the 10% shareholding was $2,900,000 as at 1 March. The purchase consideration included a $2,700,000 note receivable due from Charlie Limited and the related interest receivable balance of $144,000, $140,000 cash and a motor vehicle owned by ITI. The motor vehicle was originally obtained at $120,000. ( for depreciation details, refer to Q1 of additional information.) Q3. A 10% share dividend was declared when the market value per share was $2.1. Q4. Paid cash to acquired 30,000 shares of its own at $2.3 each. ITI intends to keep the shares for several months for management bonus.
On January 2, Todd Company acquired 40% of the outstanding stock of McGuire Company for $205,000. For the year ending December 31, McGuire earned income of $48,000 and paid dividends of $14,000. Required: Journalize the entries for Todd Company for the purchase of the stock, share of McGuire Company income, and dividends received from McGuire Company. If an amount box does not require an entry, leave it blank. Jan. 2 Dec. 31 Dec. 31 0000 ☐☐☐☐☐☐
The following are two independent situations.Situation 1Cheyenne Cosmetics acquired 10% of the 191,000 shares of common stock of Martinez Fashion at a total cost of $14 per share on March 18, 2020. On June 30, Martinez declared and paid $80,900 cash dividend to all stockholders. On December 31, Martinez reported net income of $121,000 for the year. At December 31, the market price of Martinez Fashion was $15 per share.Situation 2Ayayai, Inc. obtained significant influence over Seles Corporation by buying 30% of Seles’s 29,700 outstanding shares of common stock at a total cost of $10 per share on January 1, 2020. On June 15, Seles declared and paid cash dividends of $33,000 to all stockholders. On December 31, Seles reported a net income of $79,200 for the year.Prepare all necessary journal entries in 2020 for both situations.
The Tornado Truck Body Company decides to repurchase 10,000 shares of its common stock on January 20. The stock has $1 par value, and the market value per share of common stock on January 20 is $8.75. The company decides to sell 5,000 of the treasury stock shares on April 30 for $9.00 per share. What is the amount of the gain recognized as a result of the transaction? Group of answer choices A)$40,000 b)$0 c)$45,000 d)$1,250 e)None of the above
Please Do not Give image format
VIPUL
Selected transactions completed by ATV Discount Corporation during the current fiscal year are as follows: Jan. Mar Apr. June Aug Oct Dec 5 Split the common stock 3 for 1 and reduced the par from $75 to $25 per share. After the split, there were 1,051,500 common shares outstanding 10 Purchased 41,200 shares of the corporation's own common stock at $27, recording the stock at cost. 30 Declared semiannual dividends of $0.90 on 71,600 shares of preferred stock and 50.13 on the common stock to stockholders of record on May 15, payable on June 15. Paid the cash dividends. Sold 28,500 shares of treasury stock at $34, receiving cash. 15 Declared semiannual dividends of $0.90 on the preferred stock and $0.13 on the common stock (before the stock dividend). In addition, a 3% common stock dividend was declared on the common stock outstanding. The fair market value of the common stock is estimated at $38. The dividend date of record in November 15 payable on December 19. 19 Paid the cash…
The following are two independent situations.Situation 1Novak Cosmetics acquired 10% of the 215,000 shares of common stock of Martinez Fashion at a total cost of $12 per share on March 18, 2020. On June 30, Martinez declared and paid $74,400 cash dividend to all stockholders. On December 31, Martinez reported net income of $133,600 for the year. At December 31, the market price of Martinez Fashion was $13 per share.Situation 2Splish, Inc. obtained significant influence over Seles Corporation by buying 30% of Seles’s 28,500 outstanding shares of common stock at a total cost of $9 per share on January 1, 2020. On June 15, Seles declared and paid cash dividends of $35,400 to all stockholders. On December 31, Seles reported a net income of $91,800 for the year.Prepare all necessary journal entries in 2020 for both situations. (
On January 15th, Sahar purchased 5,000 shares of National Cement Co. on a margin of $160 per share. On March 15th the price of National Cement stock declined to $140. The initial margin and maintenance margin requirements were 60% and 40% respectively. What is the actual market value (AM) on March 5th ? 54.29% 42.86 % 40% 60%