Some of the account balances of Sandhill Limited at December 31, 2022, are as follows: $4 Preferred shares (2,500 shares authorized, 2,500 shares issued and outstanding) Common shares (unlimited authorized, 49,000 shares issued and outstanding) Contributed surplus Retained earnings Accumulated other comprehensive income $530,000 560,000 109,000 796,000 23,885 The price of the company's common shares has been increasing steadily on the market; it was $23 on January 1, 2023, and advanced to $26 by July 1 and to $29 at the end of 2023. The preferred shares are not openly traded but were appraised at $122 per share during 2023. Sandhill follows IFRS and had net income of $153,000 during 2023. For the purpose of this question, ignore any dividend entitlement to the preferred shareholders.
Some of the account balances of Sandhill Limited at December 31, 2022, are as follows: $4 Preferred shares (2,500 shares authorized, 2,500 shares issued and outstanding) Common shares (unlimited authorized, 49,000 shares issued and outstanding) Contributed surplus Retained earnings Accumulated other comprehensive income $530,000 560,000 109,000 796,000 23,885 The price of the company's common shares has been increasing steadily on the market; it was $23 on January 1, 2023, and advanced to $26 by July 1 and to $29 at the end of 2023. The preferred shares are not openly traded but were appraised at $122 per share during 2023. Sandhill follows IFRS and had net income of $153,000 during 2023. For the purpose of this question, ignore any dividend entitlement to the preferred shareholders.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Some of the account balances of Sandhill Limited at December 31, 2022, are as follows:
$4 Preferred shares (2,500 shares authorized, 2,500 shares issued and outstanding)
Common shares (unlimited authorized, 49,000 shares issued and outstanding)
Contributed surplus
Retained earnings
Accumulated other comprehensive income
$530,000
560,000
109,000
796,000
23,885
The price of the company's common shares has been increasing steadily on the market; it was $23 on January 1, 2023, and advanced
to $26 by July 1 and to $29 at the end of 2023. The preferred shares are not openly traded but were appraised at $122 per share
during 2023. Sandhill follows IFRS and had net income of $153,000 during 2023. For the purpose of this question, ignore any dividend
entitlement to the preferred shareholders.
Transcribed Image Text:The company declared a property dividend on April 1. Each common shareholder was to receive one share of Wildhorse Corp. for
every 10 shares outstanding. Sandhill had 8,500 shares of Wildhorse (2% of the outstanding shares), which it had purchased in
2018 for $69,530. The shares are accounted for using the FV-OCI model. The accumulated other comprehensive income relates
only to these shares. The fair value of the Wildhorse shares was $18 per share on April 1. The property dividend was distributed
on April 21 when the fair value of the Wildhorse shares was $19.50. The Wildhorse shares remained at a fair value of $19.50 until
year end.
Prepare the journal entries. (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 O for the amounts. Round
answers to O decimal places, e.g. 5,275. Do not round intermediate calculations. Record entries in the order displayed in the problem
statement.)
Date
Account Titles and Explanation
(To record fair value adjustment)
(To record declaration of property dividend)
Debit
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