Explanation Journal entry : Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically. Rules of Debit and Credit: Following rules are followed for debiting and crediting different accounts while they occur in business transactions: Debit , all increase in assets, expenses and dividends, all decrease in liabilities, revenues and equities. Credit, all increase in liabilities, revenues, and equities, all decrease in assets, and expenses. Prepare the journal entries to record the given transactions as follows: Date Account Titles and Description Post Ref. Debit ($) Credit ($) January 2, 2015 Long-Term Investments - Company G 411,000 Cash 411,000 (To record the purchase of Company G’s shares. September 1 , 2015 Cash (1) 45,000 Long-term investment-Company G 45,000 (To record the cash dividend received) December 31, 2015 Long-Term Investments - Company G 162,300 Earnings from long-term investment (2) 162,300 (To record the earnings from long-term investment) June 1, 2016 Cash (3) 63,000 Long-term investment-Company G 63,000 (To record the cash dividend received) December 31, 2016 Long-Term Investments - Company G 234,250 Earnings from long-term investment (4) 234,250 (To record the earnings from long-term investment) December 31, 2016 Cash 320,000 Gain on sale of investment (7) 86,817 Long-term investment – Company G (6) 233,183 (To record sale of investment and gain from sale of investment) Table (1) Working note: Calculate the dividend revenue received from Company G for the year 2015 Dividends = ( Number of shares × Dividend per share ) = ( 30 , 000 × $ 1.50 per share ) = $ 45 , 000 (1) Calculate the earnings from long-term investment for the year 2015 Earnings from long-term investment } = Principle × Rate (33 .1/3%) × Time =$486,900 × 1 3 × 12 12 = $ 162 , 300 (2) Calculate the dividend revenue received from Company G for the year 2016 Dividends = ( Number of shares × Dividend per share ) = ( 3 , 000 × $ 2

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ISBN: 9781259695759

Author: Wild

Publisher: McGraw-Hill Publishing Co.

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Chapter C, Problem 12E

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Prepare the journal entries to record the given transactions.

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Chapter C, Problem 11E

Chapter C, Problem 13E

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Chapter C Solutions

FINANCIAL ACCOUNTING FUNDAMENTALS W/CO

Ch. C - Prob. 1MCQ Ch. C - Prob. 2MCQ Ch. C - Prob. 3MCQ Ch. C - Prob. 4MCQ Ch. C - Prob. 5MCQ Ch. C - Prob. 1DQ Ch. C - Prob. 2DQ Ch. C - Prob. 3DQ Ch. C - Prob. 4DQ Ch. C - Prob. 5DQ

Ch. C - Prob. 6DQ Ch. C - Prob. 7DQ Ch. C - Prob. 8DQ Ch. C - Prob. 9DQ Ch. C - Prob. 10DQ Ch. C - Prob. 11DQ Ch. C - Prob. 12DQ Ch. C - Prob. 13DQ Ch. C - Prob. 14DQ Ch. C - Prob. 15DQ Ch. C - Prob. 16DQ Ch. C - Prob. 17DQ Ch. C - Prob. 1QS Ch. C - Prob. 2QS Ch. C - Prob. 3QS Ch. C - Prob. 4QS Ch. C - Prob. 5QS Ch. C - Prob. 6QS Ch. C - Prob. 7QS Ch. C - Prob. 8QS Ch. C - Prob. 9QS Ch. C - Prob. 10QS Ch. C - Prob. 11QS Ch. C - Prob. 12QS Ch. C - Prob. 13QS Ch. C - QS C-14 Return on total assets The return on total...Ch. C - Prob. 15QS Ch. C - Prob. 16QS Ch. C - Prob. 17QS Ch. C - Prob. 18QS Ch. C - Prob. 1E Ch. C - Prob. 2E Ch. C - Prob. 3E Ch. C - Prob. 4E Ch. C - Prob. 5E Ch. C - Prob. 6E Ch. C - Prob. 7E Ch. C - Prob. 8E Ch. C - Prob. 9E Ch. C - Prob. 10E Ch. C - Prob. 11E Ch. C - Prob. 12E Ch. C - Prob. 13E Ch. C - Prob. 14E Ch. C - Prob. 15E Ch. C - Prob. 16E Ch. C - Prob. 17E Ch. C - Prob. 1AP Ch. C - Prob. 2AP Ch. C - Prob. 3AP Ch. C - Prob. 4AP Ch. C - Prob. 5AP Ch. C - Prob. 6AP Ch. C - Prob. 1BP Ch. C - Prob. 2BP Ch. C - Prob. 3BP Ch. C - Prob. 4BP Ch. C - Prob. 5BP Ch. C - Prob. 6BP Ch. C - Prob. 1SP Ch. C - Prob. 1BTN Ch. C - Prob. 2BTN Ch. C - Prob. 3BTN Ch. C - Prob. 4BTN Ch. C - Prob. 5BTN Ch. C - Prob. 7BTN Ch. C - Prob. 9BTN

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