Rossow purchased 1,900 shares of Reimer on July 12, 2021, for $72,200; Reimer reported $45,000 net income on December 31, 2021; Reimer's stock price was $44 on December 31, 2021; Reimer declared and paid a $3 per share cash dividend on May 1, 2022; Reimer reported $45,000 net income on December 31, 2022; and Reimer's stock price was $39 on December 31, 2022.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question
!
Required information
[The following information applies to the questions displayed below.]
The following information pertains to Rossow Corporation and its investee Reimer Company:
a. Rossow purchased 1,900 shares of Reimer on July 12, 2021, for $72,200;
b. Reimer reported $45,000 net income on December 31, 2021;
c. Reimer's stock price was $44 on December 31, 2021;
d. Reimer declared and paid a $3 per share cash dividend on May 1, 2022;
e. Reimer reported $45,000 net income on December 31, 2022; and
f. Reimer's stock price was $39 on December 31, 2022.
2. Prepare journal entries to record the facts in the case, assuming Rossow owns 43 percent of Reimer's stock. Reimer reported
$45,000 of net income each year. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first
account field.)
View transaction list
Journal entry worksheet
A B C
Record the purchase of 1,900 shares (43%) of Reimer Company for $72,200.
The company will record the investment under the equity method of
accounting.
Note: Enter debits before credits.
Date
July 12, 2021
D E F
Record entry
General Journal
Clear entry
Debit
Credit
View general journal
Transcribed Image Text:! Required information [The following information applies to the questions displayed below.] The following information pertains to Rossow Corporation and its investee Reimer Company: a. Rossow purchased 1,900 shares of Reimer on July 12, 2021, for $72,200; b. Reimer reported $45,000 net income on December 31, 2021; c. Reimer's stock price was $44 on December 31, 2021; d. Reimer declared and paid a $3 per share cash dividend on May 1, 2022; e. Reimer reported $45,000 net income on December 31, 2022; and f. Reimer's stock price was $39 on December 31, 2022. 2. Prepare journal entries to record the facts in the case, assuming Rossow owns 43 percent of Reimer's stock. Reimer reported $45,000 of net income each year. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet A B C Record the purchase of 1,900 shares (43%) of Reimer Company for $72,200. The company will record the investment under the equity method of accounting. Note: Enter debits before credits. Date July 12, 2021 D E F Record entry General Journal Clear entry Debit Credit View general journal
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 3 steps

Blurred answer
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education