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FINANCIAL ACCOUNTING
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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Use information in attachement to provide correct option 

Option B
Option A
Option D
Option C
Guido Inc. buys 2,000 shares of Weiner Company for $30 per share on January 1, 2006. At the end of 2006, Weiner shares are trading at $33 per share. Weiner has a total of 200,000 shares outstanding and reported net income of $3,000,000 and paid dividends of $1,000,000 for fiscal 2006. Determine the amount Guido Inc. will record as an investment on its balance sheet under the three scenarios: Weiner is considered trading marketable equity security (MES), available for sale (AFS) MES, or using cost method. A) B) D) Trading MES $60,000 $66,000 $60,000 $66,000 AFS MES Cost $60,000 $60,000 $60,000 $60,000 $66,000 $60,000 $66,000 $60,000
Transcribed Image Text:Guido Inc. buys 2,000 shares of Weiner Company for $30 per share on January 1, 2006. At the end of 2006, Weiner shares are trading at $33 per share. Weiner has a total of 200,000 shares outstanding and reported net income of $3,000,000 and paid dividends of $1,000,000 for fiscal 2006. Determine the amount Guido Inc. will record as an investment on its balance sheet under the three scenarios: Weiner is considered trading marketable equity security (MES), available for sale (AFS) MES, or using cost method. A) B) D) Trading MES $60,000 $66,000 $60,000 $66,000 AFS MES Cost $60,000 $60,000 $60,000 $60,000 $66,000 $60,000 $66,000 $60,000
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