Financial Accounting
9th Edition
ISBN: 9781259738692
Author: Libby
Publisher: MCG
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Chapter A, Problem 9P
To determine
Explain the effect of equity-method investment on the operating activities section investing activities section of
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Subject : Accounting
Entries for Stock Investments, Dividends, and Sale of Stock
Seamus Industries Inc. buys and sells investments as part of its ongoing cash management. The following investment transactions were completed during the year:
Feb. 24
Acquired 2,000 shares of Tett Co. stock for $80 per share plus a $200 brokerage commission.
May 16
Acquired 2,000 shares of Issacson Co. stock for $40 per share plus a $100 commission.
July 14
Sold 500 shares of Tett Co. stock for $100 per share less a $50 brokerage commission.
Aug. 12
Sold 1,000 shares of Issacson Co. stock for $34 per share less an $80 brokerage commission.
Oct. 31
Received dividends of $0.30 per share on Tett Co. stock.
Journalize the entries for these transactions under the fair value method.
If an amount box does not require an entry, leave it blank.
Feb. 24
Investments-Tett Co. Stock
fill in the blank 2
fill in the blank 3
Cash
fill in the blank 5
fill in the blank 6
May 16
Investments-Issacson Co. Stock
fill…
Entries for Stock Investments, Dividends, and Sale of Stock
Seamus Industries Inc. buys and sells investments as part of its ongoing cash management. The following investment transactions were completed during the year:
Feb. 24
Acquired 400 shares of Tett Co. stock for $157 per share plus a $124 brokerage commission.
May 16
Acquired 1,600 shares of Issacson Co. stock for $35 per share plus a $160 commission.
July 14
Sold 200 shares of Tett Co. stock for $174 per share less a $113 brokerage commission.
Aug. 12
Sold 600 shares of Issacson Co. stock for $28 per share less a $87 brokerage commission.
Oct. 31
Received dividends of $0.42 per share on Tett Co. stock.
Journalize the entries for these transactions.
In your computations, round per share amounts to two decimal places. When required, round final answers to the nearest dollar. For a compound transaction, if an
amount box does not require an entry, leave it blank.
Feb. 24
May 16
July 14
Aug. 12
Chapter A Solutions
Financial Accounting
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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- Entries for Stock Investments, Dividends, and Sale of Stock Seamus Industries Inc. buys and sells investments as part of its ongoing cash management. The following investment transactions were completed during the year: Feb. 24 Acquired 500 shares of Tett Co.'s stock for $163 per share plus a $145 brokerage commission. May 16 Acquired 1,200 shares of Issacson Co.'s stock for $45 per share plus a $192 commission. July 14 Sold 200 shares of Tett Co. stock for $181 per share less a $118 brokerage commission. Aug. 12 Sold 400 shares of Issacson Co. stock for $36 per share less a $112 brokerage commission. Oct. 31 Received dividends of $0.42 per share on Tett Co. stock. Dec. 31 At the end of the accounting period, the fair value of the remaining 300 shares of Tett Co.'s stock was $163.49 per share. The fair value of the remaining 800 shares of Isaacson Co.'s stock was equal to its cost of $45.16 per share. Journalize the entries for these transactions. In your…arrow_forwardAn analysis of Karman Corporation's Investment in Marketable Securities account during Year 2 disclosed the following: Debit entries Credit entries Karman's Year 2 income statement included a $40,000 gain on sale of marketable securities and $30,000 dividend income from marketable securities. All payments and proceeds relating to marketable securities transactions were in cash. $ 160,000 240,000 The cash proceeds received by Karman Corporation in Year 2 for the sale of marketable securities was: Select one: a. $240,000. b. $280,000. c. $230,000. d. $160,000. $arrow_forwardGympa reported on its income statement a net income $647,000 for the year ended December 31 before considering the following: a. During the year, Gympa purchased trading securities b. At year-end , the fair value of the investment portfolio was $50,000 lesshan the cost c. The balance of Retained Earnings was $792,000 on January 1 d. Gympa paid $67,000 in cash dividends during the year. Using the above data, calculate the balance of Retained Earnings on Decemeber 31.arrow_forward
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