FINANCIAL ACCOUNTING 9TH
16th Edition
ISBN: 9781308821672
Author: Libby
Publisher: MCG/CREATE
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Chapter A, Problem 5AP
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Explain the effect of available-for-sale securities and equity-method investment on the operating activities section investing activities section of
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Prepare the journal entries to record the following non-strategic investment transactions of Ace Investment Corporation that occurred during the year 2020.
April 16 Bought 3,000 common shares of Aby Motors Co. at $22.50 per share
August 1 The Board of Directors of Aby Motors Co. declared a dividend of $1.25 per common share to shareholders of record of August 10, payable on August 15
August 15 Received the Aby Motors Co. dividend
October 20` Sold the Aby Motors Co. shares at $27.00
Seamus Industries Inc. buys and sells investments as part of its ongoing cash management. The following investment transactions were completed during the year: Dec. 31. At the end of the accounting period, the fair value of the remaining 600 shares of Tetts Co.'s stock was $85.35 per share. The fair value of the remaining 1,750 shares for Issaxson Co.'s stock was equal to its cost of 436.04 per share.
Journalize the entry for this transactions.
SFP accounts of Sandhill Inc., which follows IFRS, follow:
Debit accounts
Cash
FV-NI investments
Accounts receivable
Merchandise inventory
Machinery
Buildings
Land
Credit accounts
Sandhill Inc.
Comparative Statement of Financial Position Accounts
December 31, 2023 and 2022
Allowance for expected credit losses
Accumulated depreciation-machinery
Accumulated depreciation-buildings
Accounts payable
Accrued liabilities
Income taxes payable
Long-term note payable-non-trade
Common shares
Retained earnings
Additional information:
1
2
3.
4.
2023
$44,900
22,660
67,390
30,430
29,400
67,420
7,500
$269,700
$1,290
5,795
13,350
29,590
2,405
910
26,300
150,000
40,060
$269,700
2022
$33,400
40,000
59,900
24,400
Sandhill's 2023 statement of income is as follows:
18,250
56,250
7,500
$239,700
$540
2,420
8,850
24,350
1,160
1,410
Sandhill has adopted the policy of classifying interest paid as operating activities and dividends paid as financing activities.
31,300
125,000
44,670
$239,700
Cash dividends…
Chapter A Solutions
FINANCIAL ACCOUNTING 9TH
Ch. A - Prob. 1QCh. A - Explain the difference in accounting methods used...Ch. A - Explain how bonds held to maturity are reported on...Ch. A - Explain the application of the cost principle to...Ch. A - Under the fair value method, when and how does the...Ch. A - Under the equity method, why does the investor...Ch. A - Prob. 7QCh. A - Prob. 8QCh. A - Prob. 9QCh. A - Company X owns 40 percent of Company Y and...
Ch. A - Prob. 2MCQCh. A - Dividends received from stock that is reported as...Ch. A - Prob. 4MCQCh. A - Prob. 5MCQCh. A - When using the equity method of accounting, when...Ch. A - Prob. 7MCQCh. A - Prob. 8MCQCh. A - Which of the following is true regarding the...Ch. A - Prob. 10MCQCh. A - Matching Measurement and Reporting Methods Match...Ch. A - Prob. 2MECh. A - Prob. 3MECh. A - Prob. 4MECh. A - Prob. 5MECh. A - Prob. 6MECh. A - Prob. 7MECh. A - Prob. 8MECh. A - Prob. 9MECh. A - Prob. 10MECh. A - Prob. 11MECh. A - Prob. 1ECh. A - Prob. 2ECh. A - Recording Transactions in the Available-for-Sale...Ch. A - Prob. 4ECh. A - Prob. 5ECh. A - Reporting Gains and Losses in the Trading...Ch. A - Prob. 7ECh. A - Prob. 8ECh. A - Prob. 9ECh. A - Prob. 10ECh. A - Prob. 11ECh. A - Prob. 1PCh. A - Prob. 2PCh. A - Prob. 3PCh. A - Prob. 4PCh. A - Prob. 5PCh. A - Comparing Methods to Account for Various Levels of...Ch. A - Prob. 7PCh. A - Recording Investments for Significant Influence LO...Ch. A - Prob. 9PCh. A - Prob. 10PCh. A - Prob. 11PCh. A - Prob. 1APCh. A - Prob. 2APCh. A - Reporting Passive Investments During January 2017,...Ch. A - Prob. 4APCh. A - Prob. 5APCh. A - Prob. 6APCh. A - Prob. 1CONCh. A - Finding Financial Information Refer to the...Ch. A - Prob. 2CPCh. A - Prob. 3CPCh. A - Prob. 4CPCh. A - Prob. 5CPCh. A - Prob. 6CP
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