Concept explainers
Available for Sale Security:
These securities are different from the held to maturity security. It includes the debt and equity securities. The main reason to purchase this security is to earn interest and dividend on investment.
Long Term Investment:
Long term investment is the investment for long period generally for more than one year. The long term investment helps in the purchase of fixed assets, expansion, or for growth of the company. It shows under assets head of the
Adjusting entries are made at the end of the year to adjust the financial position of the enterprise according to accrual basis of accounting.
To prepare: Adjusting
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FINANCIAL ACCT.FUND.(LOOSELEAF)
- STOCK ISSUANCE (NONCASH ASSETS, SUBSCRIPTIONS, AND TREASURY STOCK) Brant Evans had the following stock transactions during the year: (a) Issued 6,000 shares of common stock with a 5 par value in exchange for real estate (land) with a fair market value of 33,500. (b) Issued 5,500 shares of common stock with a 5 par value and 7 fair market value in exchange for a building with an uncertain fair market value. (c) Received subscriptions for 11,000 shares of 5 par common stock for 58,000. (d) Received a payment of 29,000 on the stock subscription in transaction (c). (e) Received the balance in full for the stock subscription in transaction (c) and issued the stock. (f) Purchased 2,000 shares of its own 5 par common stock for 6 a share. (g) Sold 1,000 shares of the treasury stock in transaction (f) for 6.50 a share. (h) Sold 1,000 shares of the treasury stock in transaction (f) for 5.75 a share. Prepare general journal entries for these transactions, identifying each by letter.arrow_forwardTreasury Stock Transactions Garrett Inc. had no treasury stock at the beginning of the year. During February, Garrett purchased 12,600 shares of treasury stock at $23 per share. In May, Garrett sold 4,500 of the treasury shares for $25 per share. In November, Garrett sold the remaining treasury shares for $18 per share. Required: Prepare journal entries for the February, May, and November treasury stock transactions.arrow_forwardEntries for selected corporate transactions Nav-Go Enterprises Inc. produces aeronautical navigation equipment. The stockholders equity accounts of Nav-Go Enterprises Inc., with balances on January 1, 20Y3, are as follows: The following selected transactions occurred during the year: Jan. 15. Paid cash dividends of 0.06 per share on the common stock. The dividend had been properly recorded when declared on December 1 of the preceding fiscal year for 34,320. Mar. 15. Sold all of the treasury stock for 6.75 per share. Apr. 13. Issued 200,000 shares of common stock for 8 per share. June 14. Declared a 3% stock dividend on common stock, to be capitalized at the market price of the stock, which is 7.50 per share. July 16. Issued the certificates for the dividend declared on June 14. Oct. 30. Purchased 50,000 shares of treasury stock for 6 per share. Dec. 30. Declared a 0.08-per-share dividend on common stock. 31. Closed the two dividends accounts to Retained Earnings. Instructions 1. Enter the January 1 balances in T accounts for the stockholders equity accounts listed. Also prepare T accounts for the following: Paid-In Capital from Sale of Treasury Stock; Stock Dividends Distributable; Stock Dividends; Cash Dividends. 2. Journalize the entries to record the transactions and post to the eight selected accounts. 3. Prepare a retained earnings statement for the year ended December 31, 20Y3. 4. Prepare the Stockholders Equity section of the December 31, 20Y3, balance sheet Using Method 1 of Exhibit 8.arrow_forward
- Please don't give solution in an image format thnksarrow_forwardDo not give solution in imagearrow_forwardPrepare journal entries to record the following transactions involving the short-term stock investments of Duke Co., all of which occurred during the current year. a. On March 22, purchased 1,000 shares of RPI Company stock at $10 per share. Duke’s stock investment results in it having an insignificant influence over RPI. b. On July 1, received a $1 per share cash dividend on the RPI stock purchased in part a. c. On October 8, sold 50 shares of RPI stock for $15 per share.arrow_forward
- View Policies Current Attempt in Progress Flint Corporation issued 1,900 shares of stock. Prepare the entry for the issuance under the following assumptions. (LUst all deblt entrles before credit entrles. Credit account titles are automatically Indented when amount is entered. Do not Indent manually.) (a) The stock had a par value of $5.25 per share and was issued for a total of $46,500. (Ь) The stock had a stated value of $5.25 per share and was issued for a total of $46,500. (c) The stock had no par or stated value and was issued for a total of $46,500. (d) The stock had a par value of $5.25 per share and was issued to attorneys for services during incorporation valued at $46,500. (e) The stock had a par value of $5.25 per share and was issued for land worth $46,500. No. Account Titles and Explanation Debit Credit (a)arrow_forwardPlease help with all answersarrow_forwardAnswer question correctlyarrow_forward
- Help me plsarrow_forwardEntries for Stock Investments, Dividends, and Sale of Stock 1. EX.15-01 Yerbury Corp. manufactures construction equipment. 2. EX.15-02 Journalize the entries to record the following selected equity investment transactions completed by Yerbury during a recent year: 3. EX.15-03 Feb. 2 Purchased for cash 800 shares of Wong Inc. stock for $36 per share plus a $400 brokerage commission. Mar. 16 Received dividends of $0.30 per share on Wong Inc. stock. 4. EX.15-06 June 7 Purchased 600 shares of Wong Inc. stock for $46 per share plus a $300 brokerage commission. 5. EX.15-08.ALGO July 26 Sold 900 shares of Wong Inc. stock for $51 per share less a $450 brokerage commission. Yerbury assumes that the first investments purchased are the first investments sold. 6. EX.15-11.ALGO Sept. 25 Received dividends of $0.40 per share on Wong Inc. stock. 7. EX.15-14.ALGO In your computations, round per share amounts to two decimal places. When required, round final answers to the nearest dollar. For a…arrow_forwardAssessing Financial Statement Effects Investments On January 1, Ball Corporation purchased shares of Leftwich Company common stock. (a) Assume that the stock acquired by Ball represents 15% of Leftwich's voting stock and that Ball has no influence over Leftwich's business decisions. Use the financial statement effects template to record the following transactions: (1) Ball purchased 10,000 common shares of Leftwich at $15 cash per share. (2) Leftwich reported annual net income of $40,000. (3) Ball received a cash dividend of $1.20 per common share from Leftwich. (4) Year-end market price of Leftwich common stock is $19 per share. Use negative signs with your answers, when appropriate. Transaction Cash Asset + (1) (2) (3) (4) Transaction Cash Asset + Balance Sheet Noncash Assets = Liabilities + (1) (2) (3) (1) Ball purchased 10,000 common shares of Leftwich at $15 cash per share. (2) Leftwich reported annual net income of $40,000. (3) Ball received a cash dividend of $1.20 per common…arrow_forward
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