GB 112/212 MANAGERIAL ACC. W/ACCESS >C<
GB 112/212 MANAGERIAL ACC. W/ACCESS >C<
17th Edition
ISBN: 9781260218831
Author: Libby
Publisher: MCG CUSTOM
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Chapter A, Problem 7E

1.

To determine

Determine the method used by Company G to account the investment in Corporation T.

2.

To determine

Journalize the transactions related to the equity-method investment.

3.

To determine

Show the reporting of investment value on balance sheet, and investment revenue in income statement of equity-method investment by Company G.

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Balance Sheet Presentation of Available-for-Sale Investments During Year 1, its first year of operations, Galileo Company purchased two available-for-sale investments as follows: Security Shares Purchased Cost Hawking Inc. 760   $34,124   Pavlov Co. 2,060   48,204   Assume that as of December 31, Year 1, the Hawking Inc. stock had a market value of $53 per share and the Pavlov Co. stock had a market value of $42 per share. Galileo Company had net income of $264,300 and paid no dividends for the year ending December 31, Year 1. All of the available-for-sale investments are classified as current assets. a.  Prepare the Current Assets section of the balance sheet presentation for the available-for-sale investments. Galileo Company Balance Sheet (selected items) December 31, Year 1 Assets     Current Assets:       $       $ b.  Prepare the Stockholders' Equity section of the balance sheet to reflect the earnings and unrealized gain (loss) for…
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Balance Sheet Presentation of Available-for-Sale Investments During Year 1, its first year of operations, Galileo Company purchased two available-for-sale investments as follows: Security Shares Purchased Cost Hawking Inc. 860   $43,602   Pavlov Co. 2,330   61,512   Assume that as of December 31, Year 1, the Hawking Inc. stock had a market value of $60 per share and the Pavlov Co. stock had a market value of $48 per share. Galileo Company had net income of $337,400 and paid no dividends for the year ending December 31, Year 1. All of the available-for-sale investments are classified as current assets. available for sale investments at cost/available for sale investments at fair value/common stock/retained earning/unrealized gain (loss) on available for sale investments/less retained earning/less unrealized gain (loss) on available for sale /plus retained earnings/plus unrealized gain (loss) on available/plus valuation allowance for available for sale/less unrealized gain…

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GB 112/212 MANAGERIAL ACC. W/ACCESS >C<

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