Required:Prepare journal entries to record the preceding transactions and events for Selk.Complete this question by entering your answers in the tabs below.Year 1Year 2Prepare journal entries to record the preceding transactions and events for Selk.View transaction list1Journal entry worksheetYear 32 3DateJanuary 05Selk purchased 60,000 shares (20% of total) of Kildaire's common stock for$1,560,000.Note: Enter debits before credits.General JournalDebitCredit Selk Steel Company, which began operations in Year 1, had the following transactions and events in its long-terminvestments.Year 1January 5 Selk purchased 60,000 shares (20% of total) of Kildaire's common stock for $1,560,000.October 23 Kildaire declared and paid a cash dividend of $3.20 per share.December 31 Kildaire's net income for the year is $1,164,000, and the fair value of its stock at December 31 is $30.00per share.Year 2October 15 Kildaire declared and paid a cash dividend of $2.60 per share.December 31 Kildaire's net income for the year is $1,476,000, and the fair value of its stock at December 31 is $32.00per share.Year 3January 2 Selk sold 3% (equal to 1,800 shares) of its investment in Kildaire for $54,200 cash.

Journal entries are the first step in recording financial transactions. Journal entries are based on…

Answered: Selk Steel Company, which began…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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United Resources Company obtained a charter from the state in January of this year. The charter authorized 211,000 shares of common stock with a par value of $1. During the year, the company earned $477,000. Also during the year, the following selected transactions occurred in the order given: a. Sold 98,000 shares of the common stock in an initial public offering for $18 per share. b. Repurchased 29,000 shares of the previously issued shares for $21 per share and is holding them as treasury stock. c. Resold 4,000 shares of treasury stock for $24 per share. Required: Prepare the stockholders' equity section of the balance sheet at the end of the year. Note: Amounts to be deducted should be indicated with a minus sign. Stockholders' equity: Contributed capital: UNITED RESOURCES COMPANY Balance Sheet (Partial) At December 31, This year Total contributed capital Total stockholders' equity
During the year, Cellular Land, Inc. issued 1,500 shares of its $0.50 stated value common stock for $15 per share, and declared and paid cash dividends totaling $0.25 per share. By what amount does contributed capital increase as a result of these events? $22,500 $750 $21,750 $22,125
For Year 1, prepare any journal and adjusting entries related to the investment in Band Inc.
On January 1, Year 5, Anderson Corporation paid $864,000 for 27,000 (20%) ofthe outstanding shares of Carter Inc. The investment was considered to be one of significantinfluence. In Year 5, Carter reported profit of $102,000; in Year 6, its profit was $112.00O. Dividends paidwere $67,000 in each of the two years. Required A Calculate the balance in Anderson's investment account as at December 31, Year 6.
An investor company owns 40% of the outstanding common stock of an investee company, which allows the investor to exercise significant influence over the investee. The Equity Investment was reported at $1,050,000 as of the end of the previous year. During the year, the investor received dividends of $110,000 from the investee. The investee reports the following income statement for the year: Revenues Expenses $2,700,000 1,800,000 900,000 100,000 Comprehensive income $1,000,000 a. How much equity income should the investor report in its net income (i.e., as part of the current year income statement)? Net income Other comprehensive income $0 b. What amount should the investor report for the Equity Investment in its balance sheet at the end of the year? $0
Dristell Incorporated had the following activities during the year (all transactions are for cash unless stated otherwise): a. A building with a book value of $419,000 was sold for $519,000. b. Additional common stock was issued for $179,000. c. Dristell purchased its own common stock as treasury stock at a cost of $84,500. d. Land was acquired by issuing a 6%, 10-year, $769,000 note payable to the seller. e. A dividend of $59,000 was paid to shareholders. f. An investment in Fleet Corporation's common stock was made for $139,000. g. New equipment was purchased for $74,500. h. A $99,500 note payable issued three years ago was paid in full. i. A loan for $119,000 was made to one of Dristell's suppliers. The supplier plans to repay Dristell this amount plus 10% interest within 18 months. Required: Calculate net cash flows from financing activities. (Cash outflows should be indicated with a minus sign.) DRISTELL INCORPORATED Statement of Cash Flows (partial) For the Year Ended December…
Swifty Corporation purchased 400 shares of Sherman Inc. common stock for $14,100 (Swifty does not have significant influence). During the year, Sherman paid a cash dividend of $3.25 per share. At year-end, Sherman stock was selling for $35.50 per share. Assume the stock is nonmarketable. Prepare Swifty's journal entries to record (a) the purchase of the investment, (b) the dividends received, and (c) the fair value adjustment. (Assume a zero balance in the Fair Value Adjustment account.) (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.) No. Account Titles and Explanation (a) (b) (c) Equity Investments Cash Cash Dividend Revenue Fair Value Adjustment Unrealized Holding Gain or Loss -Income Debit 14,100 1,300 100 Credit 14,100 1,300 100
Earth Inc. purchased 13,500 of the common shares of Moon Inc. on January 1, Year 2 for $310,500. Moon had 90,000 common shares outstanding. During Year 2, Moon had income of $110,000 and paid dividends of $60,000. On December 31, Year 2 the selling price of Moon's shares was $25 per share. Earth purchased additional 9,000 shares of Moon's common shares on March 1, Year 3 for $216,000. During Year 3, Moon had income of $120,000 earned evenly over the year. On December 31, Moon declared dividends of $70,000. On December 31, Year 3 the selling price of Moon's shares was $21 per share. January 2, Year 4, Moon's shares price fell to $19.50 per share and the decline is considered permanent. Required: Prepare all the journal entries for Years 2, 3 and January 2, Year 4 related to Earth's investment in Moon. Write out ALL account names and show all calculations for full marks
Scott Co. acquired a 30% interest in Roker, Inc. for $210,000 and appropriately applied the equity method. During the first year, Roker, Inc. reported net income of $125,000 and paid cash dividends totaling $25,000.What amount will Scott report as it relates to the investment at the end of the first year on its income statement? Select one: A. Investment earnings totaling $37,500 B. Investment earnings totaling $22,500 C. Receipt of dividends totaling $7,500 D. Net investment earnings totaling $75,000
West Asset Management Inc. purchased a stock at $78.26 per share at the beginning of the year and held the stock for one year. At the end of the year, West Asset Management sold all of its holdings for this stock at $83.26 per share and received a dividend of $4.25 per share. What was West Asset Management’s total investment return for this stock in the holding period? A. 6.39% B. 15.64% C. 11.82% D. 5.43%
Rios Co. is a regional insurance company that began operations on January 1, 20Y2. The following selected transactions relate to investments acquired by Rios Co., which has a fiscal year ending on December 31: Record these transactions on page 10: 20Y2 Feb. 1 Purchased 6,600 shares of Caldwell Inc. common stock at $43 per share plus a brokerage commission of $660. Caldwell has 100,000 shares of common stock outstanding. May 1 Purchased securities of Holland Inc. as a trading investment for $82,998. July 1 Sold 3,430 shares of Caldwell Inc. for $41 per share less a $115 brokerage commission. 31 Received an annual dividend of $0.25 per share on 3,170 shares of Caldwell Inc. stock. Nov. 15 Sold the remaining shares of Caldwell Inc. for $44 per share less a $95 brokerage commission. Dec. 31 The trading securities of Holland Inc. have a fair value on December 31 of $74,343. Record these transactions on page 11: 20Y3 Apr. 1 Purchased…
The following transactions occurred last year at Jost Company: Issuance of shares of the company’s own common stock $170,000 ; Dividends paid to the company’s own shareholders $7,000; Dividends received from investments in other companies’ shares $4,000; Interest paid on the company’s own bonds $11,000; Repayment of principal on the company’s own bonds $40,000; Proceeds from sale of the company’s used equipment $23,000; Purchase of land $120,000 . Based solely on the above information, the net cash provided by financing activities for the year on the statement of cash flows would be: a.$112,000 b. $123,000 c. $375,000 d. $19,000

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