FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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On January 1, 2024, Cat Company purchased the following
investments:
1) 20,000 shares (representing 35%) of AA Company stock
for $23 per share.
2) 8,000 shares (representing 14%) of ZZ Company stock
for $15 per share..
Cat Company recorded the sale of some of its investments
during 2025 as follows:
1) On December 31, 2025, Cat Company sold 6,000 shares
of the AA Company stock for $30 per share.
2) On September 1, 2025, Cat Company sold 4,000 shares
of the ZZ Company stock for $21 per share.
During 2024 and 2025, AA Company and ZZ Company reported
the following information:
AA Company:
Net income.
Total dividends paid
Market value at Dec 31
ZZ Company:
Net income
Total dividends paid
Market value at Dec 31
2024
$200,000
$105,000
$27 per share
2024
$260,000
$125,000
$26 per share
2025
$160,000
$ 35,000
$24 per share
2025
$225,000
$100,000
$29 per share
Calculate the balance in the Investment in AA Company account
reported on Cat Company's December 31, 2024 balance sheet.
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Transcribed Image Text:On January 1, 2024, Cat Company purchased the following investments: 1) 20,000 shares (representing 35%) of AA Company stock for $23 per share. 2) 8,000 shares (representing 14%) of ZZ Company stock for $15 per share.. Cat Company recorded the sale of some of its investments during 2025 as follows: 1) On December 31, 2025, Cat Company sold 6,000 shares of the AA Company stock for $30 per share. 2) On September 1, 2025, Cat Company sold 4,000 shares of the ZZ Company stock for $21 per share. During 2024 and 2025, AA Company and ZZ Company reported the following information: AA Company: Net income. Total dividends paid Market value at Dec 31 ZZ Company: Net income Total dividends paid Market value at Dec 31 2024 $200,000 $105,000 $27 per share 2024 $260,000 $125,000 $26 per share 2025 $160,000 $ 35,000 $24 per share 2025 $225,000 $100,000 $29 per share Calculate the balance in the Investment in AA Company account reported on Cat Company's December 31, 2024 balance sheet.
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