Financial Accounting (12th Edition) (What's New in Accounting)
12th Edition
ISBN: 9780134725987
Author: C. William Thomas, Wendy M. Tietz, Walter T. Harrison Jr.
Publisher: PEARSON
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Textbook Question
Chapter E, Problem E.26BE
(Learning Objective 2: Analyze and report investments in equity securities) During the most recent year, Smither Travelers Co. bought 3,400 shares of German Corporation common stock at $37, 630 shares of British Corporation stock at $47.00, and 1,400 shares of Milan Corporation stock at $76. At December 31, Hoover’s Online reports German stock at $28.88, British at $49.00, and Milan at $69.25. Smither Travelers does not own more than 10% of the outstanding stock in any of its investments.
Requirements
- 1. Determine the cost and the fair value of the long-term investment portfolio at December 31.
- 2. Record Smither Travelers'
adjusting entry at December 31. - 3. What would Smither Travelers report on its income statement and
balance sheet at year-end for the information given? Ignore income taxes.
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In January 2022, the management of Handley Corporation, a publicly-traded company, decides that it has sufficient cash to purchase some debt and equity securities to be held as trading investments. During the year, the following transactions occurred.
Feb. 1
Purchased 1,100 shares of NJF common shares for $48,400.
Mar. 1
Purchased 500 shares of SEK common shares for $20,000.
Apr. 1
Purchased 73 $1,000, 8% CRT bonds for $74,200. Interest is receivable semi-annually on April 1 and October 1.
July 1
Received a cash dividend of $0.60 per share on the NJF common shares.
Aug. 1
Sold 180 shares of NJF common shares at $39.00 per share.
Sept. 1
Received $2 per share cash dividend on the SEK common shares.
Oct. 1
Received the semi-annual interest on the CRT bonds.
Oct. 1
Sold the CRT bonds for $79,240.
At December 31, Handley’s fiscal year end, the fair values of the NJF and SEK common shares were $38 and $29 per share, respectively.
Record the above…
Chapter E Solutions
Financial Accounting (12th Edition) (What's New in Accounting)
Ch. E - Prob. 1QCCh. E - Rolling Hills Productions held investments in...Ch. E - Prob. 3QCCh. E - Crandall's investment is in less than 2% of...Ch. E - Dumois Corporation purchased 1,500 shares of...Ch. E - Prob. 6QCCh. E - Use the Dumois Corporation data in question 5....Ch. E - Prob. 8QCCh. E - Prob. 9QCCh. E - Prob. 10QC
Ch. E - Prob. E.1SCh. E - (Learning Objective 2: Account for investments in...Ch. E - Prob. E.3SCh. E - Prob. E.4SCh. E - Prob. E.5SCh. E - Prob. E.6SCh. E - Prob. E.7SCh. E - Prob. E.8SCh. E - Prob. E.9SCh. E - Prob. E.10SCh. E - (Learning Objective 5: Record a held-to-maturity...Ch. E - Prob. E.12SCh. E - (Learning Objective 5: Calculate and record...Ch. E - Prob. E.14SCh. E - Prob. E.15SCh. E - Prob. E.16SCh. E - Prob. E.17AECh. E - (Learning Objective 2: Record transactions for...Ch. E - (Learning Objective 2: Analyze and report...Ch. E - Prob. E.20AECh. E - Prob. E.21AECh. E - Prob. E.22AECh. E - Prob. E.23AECh. E - Prob. E.24BECh. E - Prob. E.25BECh. E - (Learning Objective 2: Analyze and report...Ch. E - (Learning Objective 3: Account for transactions...Ch. E - Prob. E.28BECh. E - Prob. E.29BECh. E - Prob. E.30BECh. E - Prob. E.31QCh. E - Prob. E.32QCh. E - Prob. E.33QCh. E - Prob. E.34QCh. E - Prob. E.35QCh. E - Dividends received on an equity-method investment...Ch. E - Prob. E.37QCh. E - Prob. E.38QCh. E - Prob. E.39APCh. E - (Learning Objectives 2, 3: Analyze and report...Ch. E - (Learning Objectives 2, 3: Analyze and report...Ch. E - Prob. E.42APCh. E - Prob. E.43BPCh. E - LO 2, 3 (Learning Objectives 2, 3: Analyze and...Ch. E - Prob. E.45BPCh. E - Prob. E.46BPCh. E - Prob. E.47DC
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