The reason for the $6,000 loss on sale of Kemper stock and why it is reported and to draft a memorandum to Mary Jolee regarding the same. Given : In December 31, 2013 50,000 shares of Kemper’s common stock were acquired at a cost of $500,000. This stock purchase represented 40% interest in Kemper. The earnings from all investments were $126000 as per the 2014 income statement. The Kemper stock was sold for $575,000 on 3 r d January 2015. Kemper did not pay any dividends but reported net income of $202,500 for that year. According to Mary Jolee, Kemper’s income statement for 2015, should report $75000 as gain on sale.

Question

Want to see the full answer?

Answer 1

Question

Chapter 15, Problem 4BTN

To determine

To determine:

The reason for the $6,000 loss on sale of Kemper stock and why it is reported and to draft a memorandum to Mary Jolee regarding the same.

Given:

In December 31, 2013 50,000 shares of Kemper’s common stock were acquired at a cost of $500,000. This stock purchase represented 40% interest in Kemper. The earnings from all investments were $126000 as per the 2014 income statement. The Kemper stock was sold for $575,000 on 3^r^d January 2015. Kemper did not pay any dividends but reported net income of $202,500 for that year. According to Mary Jolee, Kemper’s income statement for 2015, should report $75000 as gain on sale.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

what is the return on assets ROA)? provide correct answer

Harper Industries sells 32,000 units at $27 per unit. Variable costs are $21.50 per unit, and fixed costs are $52,800. a. Determine the contribution margin ratio. b. Determine the unit contribution margin. c. Determine the income from operations.

Determine the direct materials and conversion costs per unit

Answer 2

Question

Chapter 15, Problem 4BTN

To determine

To determine:

The reason for the $6,000 loss on sale of Kemper stock and why it is reported and to draft a memorandum to Mary Jolee regarding the same.

Given:

In December 31, 2013 50,000 shares of Kemper’s common stock were acquired at a cost of $500,000. This stock purchase represented 40% interest in Kemper. The earnings from all investments were $126000 as per the 2014 income statement. The Kemper stock was sold for $575,000 on 3^r^d January 2015. Kemper did not pay any dividends but reported net income of $202,500 for that year. According to Mary Jolee, Kemper’s income statement for 2015, should report $75000 as gain on sale.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 15, Problem 4BTN

To determine

To determine:

The reason for the $6,000 loss on sale of Kemper stock and why it is reported and to draft a memorandum to Mary Jolee regarding the same.

Given:

In December 31, 2013 50,000 shares of Kemper’s common stock were acquired at a cost of $500,000. This stock purchase represented 40% interest in Kemper. The earnings from all investments were $126000 as per the 2014 income statement. The Kemper stock was sold for $575,000 on 3^r^d January 2015. Kemper did not pay any dividends but reported net income of $202,500 for that year. According to Mary Jolee, Kemper’s income statement for 2015, should report $75000 as gain on sale.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 15, Problem 4BTN

To determine

To determine:

The reason for the $6,000 loss on sale of Kemper stock and why it is reported and to draft a memorandum to Mary Jolee regarding the same.

Given:

In December 31, 2013 50,000 shares of Kemper’s common stock were acquired at a cost of $500,000. This stock purchase represented 40% interest in Kemper. The earnings from all investments were $126000 as per the 2014 income statement. The Kemper stock was sold for $575,000 on 3^r^d January 2015. Kemper did not pay any dividends but reported net income of $202,500 for that year. According to Mary Jolee, Kemper’s income statement for 2015, should report $75000 as gain on sale.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 15, Problem 4BTN

To determine

To determine:

The reason for the $6,000 loss on sale of Kemper stock and why it is reported and to draft a memorandum to Mary Jolee regarding the same.

Given:

In December 31, 2013 50,000 shares of Kemper’s common stock were acquired at a cost of $500,000. This stock purchase represented 40% interest in Kemper. The earnings from all investments were $126000 as per the 2014 income statement. The Kemper stock was sold for $575,000 on 3^r^d January 2015. Kemper did not pay any dividends but reported net income of $202,500 for that year. According to Mary Jolee, Kemper’s income statement for 2015, should report $75000 as gain on sale.

Answer 6

Chapter 15, Problem 4BTN

To determine

To determine:

The reason for the $6,000 loss on sale of Kemper stock and why it is reported and to draft a memorandum to Mary Jolee regarding the same.

Given:

In December 31, 2013 50,000 shares of Kemper’s common stock were acquired at a cost of $500,000. This stock purchase represented 40% interest in Kemper. The earnings from all investments were $126000 as per the 2014 income statement. The Kemper stock was sold for $575,000 on 3^r^d January 2015. Kemper did not pay any dividends but reported net income of $202,500 for that year. According to Mary Jolee, Kemper’s income statement for 2015, should report $75000 as gain on sale.

Answer 7

Chapter 15, Problem 4BTN

To determine

To determine:

The reason for the $6,000 loss on sale of Kemper stock and why it is reported and to draft a memorandum to Mary Jolee regarding the same.

Given:

In December 31, 2013 50,000 shares of Kemper’s common stock were acquired at a cost of $500,000. This stock purchase represented 40% interest in Kemper. The earnings from all investments were $126000 as per the 2014 income statement. The Kemper stock was sold for $575,000 on 3^r^d January 2015. Kemper did not pay any dividends but reported net income of $202,500 for that year. According to Mary Jolee, Kemper’s income statement for 2015, should report $75000 as gain on sale.

Answer 8

Expert Solution & Answer

Answer 9

Expert Solution & Answer

Answer 10

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 11

Ch. 15 - Prob. 1DQ Ch. 15 - Prob. 2DQ Ch. 15 - Prob. 3DQ Ch. 15 - Prob. 4DQ Ch. 15 - Prob. 5DQ Ch. 15 - Prob. 6DQ Ch. 15 - Prob. 7DQ Ch. 15 - Prob. 8DQ Ch. 15 - Prob. 9DQ Ch. 15 - Prob. 10DQ

Videos

Want to see the full answer?

Chapter 15 Solutions