Horngren's Accounting
11th Edition
ISBN: 9780133851151
Author: MILLER-NOBLES, Tracie L., Mattison, Brenda., Matsumura, Ella Mae, Horngren, Charles T.
Publisher: Pearson,
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Chapter 15, Problem P15.22BPGB
To determine
Concept introduction: Available for sale (AFS) securities are those securities which are not classified as trading or held-to-maturity securities. In other words we can say that those securities do not fall under trading or held-to-maturity securities categories, are known as available for sale securities.
Requirement 1;
To prepare: Journal entry for the investment transactions.
To determine
Requirement 2;
To prepare: Preparation of T accounts.
Main solution:
| Investment in Larsen’s Stock | |||
|---|---|---|---|
| Debit | Credit | ||
| Beginning balance | $800000 | Cash (dividend revenue) | $110000 |
| Equity in Earnings of Parson | $38500 | ||
| Ending balance | $728500 | ||
| $838500 | $838500 | ||
| Long-term Investment-Available for Sale Securities | |||
|---|---|---|---|
| Debit | Credit | ||
| Cash | $42000 | ||
| Unrealized holding gain on available for sale securities | $18000 | Ending balance | $60000 |
| $60000 | $60000 | ||
| Dividend Revenue | |||
|---|---|---|---|
| Debit | Credit | ||
| Income Statement | $3180 | Cash | $3180 |
| $3180 | $3180 | ||
| Equity in Earnings of Larsen | |||
|---|---|---|---|
| Debit | Credit | ||
| Investment in larsen’s Stock | $38500 | ||
| Ending balance | $38500 | ||
| $38500 | $38500 | ||
| Unrealized Holding gain on Available for Sale Securities | |||
|---|---|---|---|
| Debit | Credit | ||
| Other Comprehensive Income-Accumulated Other Comprehensive Income | $18000 | Long-term Investment – Available for Sale Securities | $18000 |
| $18000 | $18000 | ||
To determine
Requirement 3;
To prepare: Partial
Main solution:
| Water Source Co. | |
|---|---|
| Balance Sheet (Partial) | |
| As on December 31, 2016 | |
| Assets | |
| Non-Current assets; | |
| Long-term Investment – Available for Sale Securities | $60000 |
| Investment in Larsen’s Stock | $728500 |
| Liabilities and stockholders’ equity; | |
| Other Comprehensive Income-Accumulated Other Comprehensive Income | $18000 |
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Chapter 15 Solutions
Horngren's Accounting
Ch. 15 - Prob. 1QCCh. 15 - Which of the following investments is most likely...Ch. 15 - Prob. 3QCCh. 15 - A company invested $45,000 in Yale Co. stock. The...Ch. 15 - Prob. 5QCCh. 15 - Prob. 6QCCh. 15 - Prob. 7QCCh. 15 - Prob. 8QCCh. 15 - Prob. 9QCCh. 15 - Prob. 10QC
Ch. 15 - Prob. 1RQCh. 15 - Prob. 2RQCh. 15 - Prob. 3RQCh. 15 - Prob. 4RQCh. 15 - Prob. 5RQCh. 15 - Prob. 6RQCh. 15 - Prob. 7RQCh. 15 - Prob. 8RQCh. 15 - Prob. 9RQCh. 15 - Prob. 10RQCh. 15 - Prob. 11RQCh. 15 - Prob. 12RQCh. 15 - Prob. 13RQCh. 15 - Prob. 14RQCh. 15 - Prob. S15.1SECh. 15 - Prob. S15.2SECh. 15 - Prob. S15.3SECh. 15 - Prob. S15.4SECh. 15 - Prob. S15.5SECh. 15 - Prob. S15.6SECh. 15 - Prob. S15.7SECh. 15 - Prob. E15.8ECh. 15 - Prob. E15.9ECh. 15 - Prob. E15.10ECh. 15 - Prob. E15.11ECh. 15 - Prob. E15.12ECh. 15 - Prob. E15.13ECh. 15 - Prob. E15.14ECh. 15 - Prob. E15.15ECh. 15 - Prob. E15.16ECh. 15 - Prob. E15.17ECh. 15 - Prob. P15.18APGACh. 15 - Prob. P15.19APGACh. 15 - Prob. P15.20APGACh. 15 - Prob. P15.21BPGBCh. 15 - Prob. P15.22BPGBCh. 15 - Prob. 23CPCh. 15 - Prob. 15.1DCCh. 15 - Prob. 15.1EICh. 15 - Prob. 15.1FCCh. 15 - Financial Statement Case 151 Details about a...
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- Glendale Manufacturing has a profit margin of 6%, a 40% dividend payout ratio, a total asset turnover of 1.5, and an equity multiplier of 1.6. What is the sustainable growth rate?arrow_forwardWhat is the direct materials quantity variance?arrow_forwardProvide answer this following requirements on these general accounting questionarrow_forward
- Glendale Manufacturing has a profit margin of 6%, a 40% dividend payout ratio, a total asset turnover of 1.5, and an equity multiplier of 1.6. What is the sustainable growth rate?Solve thisarrow_forwardDuring May, Schultz Company produced 12,000 units of a product called Premium. Premium has a standard materials cost of three pieces per unit at $6 per piece. The actual materials used consisted of 35,000 pieces at a cost of $175,000. Actual purchases of the materials amounted to 45,000 pieces at a cost of $225,000. Compute the two materials variances.arrow_forwardSolve this ?arrow_forward
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