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1.
No significant influence equity investments:
These investments are the investments in equity securities where the investor holds less than 20% of the voting stock, and thereby the investor would not be able to participate in the decisions of the investee company. These investments are reported as the current assets or the long-term assets on the basis of the period which the investor holds the investments.
Available-for-sale debt investments:
Available-for-sale debt investments are the investments in debt securities, which are neither referred as trading debt investments nor referred to as held-to-maturity debt investments. The investors do not wish to hold them till maturity, and hence reported either as current assets or as long-term assets in the
To Journalize: The transactions of Company WS for the year 2018.
2.
To Prepare: T-accounts to determine the year ended balances as on December 31, 2018 related to the investment and investment income accounts.
3.
To prepare: Company WS’s partial balance sheet at December 31, 2018.
4.
To indicate: The statement in which the unrealized holding gain or loss associated with L stock is reported.
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Chapter 10 Solutions
Horngren's Financial & Managerial Accounting, The Managerial Chapters, Student Value Edition (6th Edition)
- On September 10, Pillsbury Manufacturing Co. issued a $65,500, 8%, 90-day note payable to Everest Suppliers Inc. assuming a 360- day year, what is the maturity value of the note?arrow_forwardPlease see an attachment for details of this financial accountingarrow_forwardBonnie and Clyde are the only two shareholders in Getaway Corporation. Bonnie owns 60 shares with a basis of $3,000, and Clyde owns the remaining 40 shares with a basis of $12,000. At year-end, Getaway is considering different alternatives for redeeming some shares of stock. Evaluate whether each of these stock redemption transactions qualify for sale or exchange treatment. Getaway redeems 29 of Bonnie’s shares for $10,000. Getaway has $26,000 of E&P at year-end and Bonnie is unrelated to Clyde.arrow_forward
- Novak supply company a newly formed corporation , incurred the following expenditures related to the land , to buildings, and to machinery and equipment. abstract company's fee for title search $1,170 architect's fee $7,133 cash paid for land and dilapidated building thereon $195,750 removal of old building $45,000 LESS: salvage $12,375 $32,625 Interest on short term loans during construction…arrow_forwardYear Cash Flow 0 -$ 27,000 1 11,000 2 3 14,000 10,000 What is the NPV for the project if the required return is 10 percent? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. NPV $ 1,873.28 At a required return of 10 percent, should the firm accept this project? No Yes What is the NPV for the project if the required return is 26 percent?arrow_forwardThe following were selected from among the transactions completed by Babcock Company during November of the current year: Nov. 3 Purchased merchandise on account from Moonlight Co., list price $85,000, trade discount 25%, terms FOB destination, 2/10, n/30. 4 Sold merchandise for cash, $37,680. The cost of the goods sold was $22,600. 5 Purchased merchandise on account from Papoose Creek Co., $47,500, terms FOB shipping point, 2/10, n/30, with prepaid freight of $810 added to the invoice. 6 Returned merchandise with an invoice amount of $13,500 ($18,000 list price less trade discount of 25%) purchased on November 3 from Moonlight Co. 8 Sold merchandise on account to Quinn Co., $15,600 with terms n/15. The cost of the goods sold was $9,400. 13 Paid Moonlight Co. on account for purchase of November 3, less return of November 6. 14 Sold merchandise with a list price of $236,000 to customers who used VISA and who redeemed $8,000 of pointof- sale coupons. The cost…arrow_forward
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