FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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On February 1, 2019, Destiny Enterprise repurchases 770 shares of its outstanding common stock for $9 per share. On March 1, 2019, Destiny sells 250 shares of
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- Check my work ! Required information [The following information applies to the questions displayed below.] On January 1, 2019, Metco Inc. reported 268,000 shares of $5 par value common stock as being issued and outstanding. On March 24, 2019, Metco Inc. purchased for its treasury 2,500 shares of its common stock at a price of $39.00 per share. On August 19, 2019, 750 of these treasury shares were sold for $45.00 per share. Metco's directors declared cash dividends of $0.40 per share during the second quarter and again during the fourth quarter, payable on June 30, 2019, and December 31, 2019, respectively. A 3% stock dividend was issued at the end of the year. There were no other transactions affecting common stock during the year. Required: a-1. Use the horizontal model for the treasury stock purchase on March 24, 2019. Indicate the financial statement effect. (Enter decreases with a minus sign to indicate a negative financial statement effect.) Balance Sheet Income Statement Assets…arrow_forwardPlease help mearrow_forwardOn 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.)arrow_forward
- Please help mearrow_forwardOn December 31, 2019, Akron, Inc., purchased 5 percent of Zip Company's common shares on the open market in exchange for $15,600. On December 31, 2020, Akron, Inc., acquires an additional 25 percent of Zip Company's outstanding common stock for $97,000. During the next two years, the following information is available for Zip Company: Income Dividends Declared Common StockFair Value (12/31) 2019 $312,000 2020 $85,000 $7,900 388,000 2021 94,000 16,000 487,000 At December 31, 2020, Zip reports a net book value of $298,000. Akron attributed any excess of its 30 percent share of Zip's fair over book value to its share of Zip's franchise agreements. The franchise agreements had a remaining life of 10 years at December 31, 2020. Assume Akron applies the equity method to its Investment in Zip account: What amount of equity income should Akron report for 2021? On Akron’s December 31, 2021, balance sheet, what amount is reported for the Investment in Zip account?arrow_forwardMidwest Bank invests in equity securities. At the beginning of December 2019, the bank held no equity securities. During December of 2019, it entered into the following transactions: Dec. 10 Purchased 600 shares of Carroll Company common stock for $75 per share. Dec. 21 Purchased 700 shares of Dynamo Company common stock for $34 per share. At the end of December, the Carroll Company common stock had a quoted market price of $78 per share, and the Dynamo Company common stock had a quoted market price of $33 per share. Required: 1. Prepare journal entries to record the preceding information. 2. What is the unrealized holding gain or loss, and where is it reported in the 2019 financial statements? 3. Show how the bank reports the equity securities on its December 31, 2019, balance sheet. 4. Next Level If Midwest uses IFRS, how would the accounting be different from U.S. GAAP?arrow_forward
- The Murphy Corporation is authorized to issue 500,000 shares of $1 par value common stock. During 2019, the company has the following stock transactions. Jan. 15 Issued 200,000 shares of stock at $6 per share. Sept. 5 Purchased 30,000 shares of common stock for the treasury at $8 per share. Dec. 6 Declared a $0.50 per share dividend to stockholders of record on December 15, payable January 5, 2020. Instructions Journalize the transactions for the Murphy Corporation on journal paper. OMIT explanationsarrow_forwardLucas Company reports net income of $5,125 for the year ended December 31, 2019, its first year of operations. On January 4, 2019, Lucas issued 9,000 shares of common stock. On August 2, 2019, it issued an additional 3,000 shares of stock, resulting in 12,000 shares outstanding at year-end. During 2020, Lucas earned net income of $16,400. It issued 2,000 additional shares of stock on March 3, 2020, and declared and issued a 2-for-1 stock split on November 3, 2020, resulting in 28,000 shares outstanding at year-end. During 2021, Lucas earned net income of $23,520. The only common stock transaction during 2021 was a 20% stock dividend issued on July 2, 2021. Compute the 2019, 2020, and 2021 comparative basic earnings per share that would be disclosed in the 2021 annual report.arrow_forwardOn July 1, 2021, an interest payment date, $150,000 of converted into 3,000 shares of Mack Co. common stock each having a par value of $45 and a market value of $54. There is $6,000 unanortized discount on the bonds . Using the book value method, Mack would record the following journal entry at the time of conversion .arrow_forward
- Marigold Inc. has outstanding 10,600 shares of $10 par value common stock. On July 1, 2020, Marigold reacquired 105 shares at $87 per share. On September 1, Marigold reissued 62 shares at $91 per share. On November 1, Marigold reissued 43 shares at $84 per share. Prepare Marigold's journal entries to record these transactions using the cost method. (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.) Date Account Titles and Explanation Debit Credit 11/1/20arrow_forwardOverland Corporation is authorized to issue 250,000 shares of $1 par value common stock. During 2020, Overland Corporation took part in the following selected transactions. Prepare journal entry(entries) for following independent event. a. Purchased 6,000 shares of treasury stock at $70 per share. The treksury shares purchased were issued in 2018 at $46 per share. Assuming Overland uses the retirement method to prepare entry and before this transaction the company had $100,000 credit balance of Paid-in capital- shares repurchase and $800,000 retained earnings b. The board votes a 4-for-1 stock split. At the date, the market value is $80 c. The board votes a 150% stock dividend. At the date, the market value is $80, assuming the company treats the distribution as "large" stock dividends effected in the form of a stock dividend and before this transaction the company has 54,000 shares of common stockarrow_forwardIvanhoe Inc. has outstanding 11,500 shares of $10 par value common stock. On July 1, 2020, Ivanhoe reacquired 111 shares at $87 per share. On September 1, Ivanhoe reissued 60 shares at $95 per share. On November 1, Ivanhoe reissued 51 shares at $85 per share.Prepare Ivanhoe’s journal entries to record these transactions using the cost method. (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.)arrow_forward
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