Sunland Corporation purchased  370 shares of Sherman Inc. common stock for $ 13,100 ( Sunland does not have significant influence). During the year, Sherman paid a cash dividend of $ 3.00 per share. At year-end, Sherman stock was selling for $ 37.50 per share. Prepare Sunland's journal entries to record (a) the purchase of the investment, (b) the dividends received, and (c) the fair value adjustment. (Assume a zero balance in the Fair Value Adjustment account.) (Credit account titles are automatically indented when 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.) No. Account Titles and Explanation Debit Credit (a) enter an account title to record the purchase of the investment enter a debit amount enter a credit amount   enter an account title to record the purchase of the investment enter a debit amount enter a credit amount (b) enter an account title to record the dividends received enter a debit amount enter a credit amount   enter an account title to record the dividends received enter a debit amount enter a credit amount (c) enter an account title to record the fair value adjustment enter a debit amount enter a credit amount   enter an account title to record the fair value adjustment enter a debit amount

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Sunland Corporation purchased  370 shares of Sherman Inc. common stock for $ 13,100 ( Sunland does not have significant influence). During the year, Sherman paid a cash dividend of $ 3.00 per share. At year-end, Sherman stock was selling for $ 37.50 per share.

Prepare Sunland's journal entries to record (a) the purchase of the investment, (b) the dividends received, and (c) the fair value adjustment. (Assume a zero balance in the Fair Value Adjustment account.) (Credit account titles are automatically indented when 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.)

No.
Account Titles and Explanation
Debit
Credit
(a)
enter an account title to record the purchase of the investment
enter a debit amount
enter a credit amount
 
enter an account title to record the purchase of the investment
enter a debit amount
enter a credit amount
(b)
enter an account title to record the dividends received
enter a debit amount
enter a credit amount
 
enter an account title to record the dividends received
enter a debit amount
enter a credit amount
(c)
enter an account title to record the fair value adjustment
enter a debit amount
enter a credit amount
 
enter an account title to record the fair value adjustment
enter a debit amount
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