Miller Corporation acquired 30% of the outstanding common stock of Crowell Corporation for $160,000 on January 1, 2019, and obtained significant influence. The purchase price of the shares was equal to their book value. During 2019, the following information is available for Crowell: Mar. 31 Declared and paid a cash dividend of $50,000. June 30 Reported semiannual earnings of $120,000 for the first half of 2019. Sept. 30 Declared and paid a cash dividend of $50,000. Dec. 31 Reported semiannual earnings of $140,000 for the second half of 2019. Required: 1. Prepare journal entries for Miller to reflect the preceding information. 2. What is the balance in Miller’s investment account on December 31, 2019?
Miller Corporation acquired 30% of the outstanding common stock of Crowell Corporation for $160,000 on January 1, 2019, and obtained significant influence. The purchase price of the shares was equal to their book value. During 2019, the following information is available for Crowell: Mar. 31 Declared and paid a cash dividend of $50,000. June 30 Reported semiannual earnings of $120,000 for the first half of 2019. Sept. 30 Declared and paid a cash dividend of $50,000. Dec. 31 Reported semiannual earnings of $140,000 for the second half of 2019. Required: 1. Prepare journal entries for Miller to reflect the preceding information. 2. What is the balance in Miller’s investment account on December 31, 2019?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Miller Corporation acquired 30% of the outstanding common stock of Crowell Corporation for $160,000 on January 1, 2019, and obtained significant influence. The purchase price of the shares was equal to their book value. During 2019, the following information is available for Crowell:
| Mar. 31 | Declared and paid a cash dividend of $50,000. |
| June 30 | Reported semiannual earnings of $120,000 for the first half of 2019. |
| Sept. 30 | Declared and paid a cash dividend of $50,000. |
| Dec. 31 | Reported semiannual earnings of $140,000 for the second half of 2019. |
Required:
| 1. | Prepare |
| 2. | What is the balance in Miller’s investment account on December 31, 2019? |
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