Duke Corporation owns a 70 percent equity interest in Salem Company, a subsidiary corporation. During the current year, a portion of this stock is sold to an outside party. Before recording this transaction, Duke adjusts the book value of its investment account. What is the purpose of this adjustment?
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Duke Corporation owns a 70 percent equity interest in Salem Company, a subsidiary corporation. During the current year, a portion of this stock is sold to an outside party. Before recording this transaction, Duke adjusts the book value of its investment account. What is the purpose of this adjustment?
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- On January 1, 2020, Ayayai Corporation purchased 20% of the common shares of Pina Company for $191,000. During the year, Pina earned net income of $71,000 and paid dividends of $17,750. Prepare the entries for Ayayai to record the purchase and any additional entries related to this investment in Pina Company in 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Account Titles and Explanation Debit Credit (To record purchase of stock.) (To record receipt of dividends.) (To record revenue.)Blue Spruce Corporation purchased 300 common shares of Burke Inc. for $22,830 and accounted for them using FV-OCI. During the year, Burke paid a cash dividend of $3.45 per share. At year end, Burke shares had a fair value of $72.50 per share. (a) Prepare Blue Spruce's journal entry to record the purchase of the investment. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List debit entry before credit entry.) Account Titles and Explanation Debit CreditDuke Corporation owns a 70 percent equity interest in Salem Company, a subsidiary corporation. During the current year, a portion of this stock is sold to an outside party. Before recording this transaction, Duke adjusts the book value of its investment account. How would the parent record the sales transaction?
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- On January 1, 2020, Pharoah Corporation purchased 40% of the common shares of Novak Company for $201,000. During the year, Novak earned net income of $77,000 and paid dividends of $19,250.Prepare the entries for Pharoah to record the purchase and any additional entries related to this investment in Novak Company in 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit (To record purchase of stock.) (To record receipt of dividends.) (To record revenue.)Gera Corporation owns two financial investments in the shares of listed companies. Details of which are as follows: Investment 1 – Acquired on September 1, 2020, at a cost of P50,000 with a Fair value of P60,000 at year-end for the purpose of trading. Investment 2 - Acquired on August 1, 2020, at a cost of P25,000 to hold indefinitely. Its fair value at year-endis P20,000. What are the amounts to appear in the statement of Profit and Loss for the year ended September 30, 2020?Jon company owns two financial investments in the shares of listed companies. With the following details: Investment 1 - Acquired on september 1, 2020 at a cost of $50,000 with a fair value of $60,000 at year end for the purpose of trading. Investment 2 - Acquired on august 1, 2020 at a cost of $25,000 to hold indefinitely. Its fair value at year end is $20,000. What are the amounts to appear in the statement of Comprehensive Income for the year ended september 30, 2020?
- At the beginning of 2021, Pioneer Products’ ownership interest in the common stock of LLB Co. increased to the point that it became appropriate to begin using the equity method of accounting for the investment. The balance in the investment account was $44 million at the time of the change but would have been $56 million if Pioneer had used the equity method since first investing in LLB. How should Pioneer report the change? Would your answer be the same if Pioneer is changing from the equity method rather than to the equity method?Gera Corporation owns two financial investments in the shares of listed companies. Details of which are as follows: Investment 1 – Acquired on September 1, 2020, at a cost of P50,000 with a Fair value of P60,000 at year-end for the purpose of trading. Investment 2 - Acquired on August 1, 2020, at a cost of P25,000 to hold indefinitely. Its fair value at year-end is P20,000. What are the amounts to appear in the Statement of Comprehensive Income for the year ended September 30, 2020?On January 1, 2025, Ayayai Corporation purchased 40% of the common shares of Pina Company for $178,000. During the year, Pina earned net income of $86,000 and paid dividends of $21,500. Prepare the entries for Ayayai to record the purchase and any additional entries related to this investment in Pina Company in 2025. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Account Titles and Explanation (To record purchase of stock.) (To record receipt of dividends.) (To record revenue.) Debit Credit ION