please and thank you Current Attempt in ProgressIndigo Company has the following securities in its portfolio on December 31, 2025. None of these investments areaccounted for under the equity method.Investments1,500 shares of Gordon, Inc., common5,000 shares of Wallace Corp., common400 shares of Martin, Inc., preferredMarch 1April 1Cost$75,000185,00062,000$322,000All of the securities were purchased in 2025.In 2026, Indigo completed the following securities transactions.Investments5,000 shares of Wallace Corp., common700 shares of Earnhart Corp., common400 shares of Martin, Inc., preferredSold the 1,500 shares of Gordon, Inc., common, @ $45 less fees of $1,200.Bought 700 shares of Earnhart Corp., common, @ $75 plus fees of $1,200.Indigo's portfolio of equity securities appeared as follows on December 31, 2026.CostNo. Account Titles and Explanation$185,00053,70062,000Fair Value$70,300180,10063,800$300,700$314,200(a) The 2025 adjusting entry.(b) The sale of the Gordon stock.(c) The purchase of the Earnhart stock.(d) The 2026 adjusting entry for the portfolio.Prepare the general journal entries for Indigo Company for:Fair Value$180,10050,00060,200$290,300(List all debit entries before credit entries. Credit account titles are automatically indented whenamount is entered. Do not indent manually. If no entry is required, select "No Entry" for the accounttitles and enter 0 for the amounts.)DebitCredit (List all debit entries before credit entries. Credit account titles are automatically indented whenamount is entered. Do not indent manually. If no entry is required, select "No Entry" for the accounttitles and enter 0 for the amounts.)No. Account Titles and Explanation(a)(b)(c)(d)eTextbook and MediaDebitCredit

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Answered: All of the securities were purchased in…

Financial Accounting

14th Edition

ISBN:9781305088436

Author:Carl Warren, Jim Reeve, Jonathan Duchac

Publisher:Carl Warren, Jim Reeve, Jonathan Duchac

Chapter15: Investments And Fair Value Accounting

Section: Chapter Questions

Problem 15E

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Waseca Company had 5 convertible securities outstanding during all of 2019. It paid the appropriate interest (and amortized any related premium or discount using the straight line method) and dividends on each security during 2019. Each of the convertible securities is described in the following table: Additional data: Net income for 2019 totaled 119,460. The weighted average number of common shares outstanding during 2019 was 40,000 shares. No share options or warrants arc outstanding. The effective corporate income tax rate is 30%. Required: 1. Prepare a schedule that lists the impact of the assumed conversion of each convertible security on diluted earnings per share. 2. Prepare a ranking of the order in which each of the convertible securities should be included in diluted earnings per share. 3. Compute basic earnings per share. 4. Compute diluted earnings per share. 5. Indicate the amount(s) of the earnings per share that Waseca would report on its 2019 income statement.
During 2021, Anthony Company purchased debt securities as a long-term investment and classified them as trading. All securities were purchased at par value. Pertinent data are as follows: The net holding gain or loss included in Anthonys income statement for the year should be: a. 0 b. 3,000 gain c. 9,000 loss d. 12,000 loss
The investments of Steelers Inc. include a single investment: 33,100 shares of Bengals Inc. common stock purchased on September 12, 2016, for 13 per share including brokerage commission. These shares were classified as available-for-sale securities. As of the December 31, 2016, balance sheet date, the share price declined to 11 per share. a. Journalize the entries to acquire the investment on September 12 and record the adjustment to fair value on December 31, 2016. b. How is the unrealized gain or loss for available-for-sale investments disclosed on the financial statements?
Statement of Stockholders' Equity At the end of 2019, Stanley Utilities Inc. had the following equity accounts and balances: During 2020, Haley engaged in the following transactions involving its equity accounts: Sold 5,000 shares of common stock for $19 per share. Sold 1.200 shares of 12%, $50 par preferred stock at $75 per share. Declared and paid cash dividends of $22,000. Repurchased 1,000 shares of treasury stock (common) for $24 per share. Sold 300 of the treasury shares for $26 per share. Required: Prepare the journal entries for Transactions a through e. Assume that 2020 net income was $123,700. Prepare a statement of stockholders equity at December 31, 2020.
On July 2, 2018, McGraw Corporation issued 500,000 of convertible bonds. Each 1,000 bond could be converted into 20 shares of the companys 5 par value stock. On July 3, 2020, when the bonds had an unamortized discount of 7,400 and the market value of the McGraw shares was 52 per share, all the bonds were converted into common stock. Required: 1. Prepare the journal entry to record the conversion of the bonds under (a) the book value method and (b) the market value method. 2. Compute the companys debt-to-equity ratio (total liabilities divided by total shareholders equity, as described in Chapter 6) under each alternative. Assume the companys other liabilities are 2 million and shareholders equity before the conversion is 3 million. 3. Assume the company uses IFRS and issued the bonds for 487,500 on July 2, 2018. On this date, it determined that the fair value of each bond was 930 and the fair value of the conversion option was 45 per bond. Prepare the journal entry to record the issuance of the bonds.

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All of the securities were purchased in 2025. In 2026, Indigo completed the following securities transactions. March 1 April 1 Sold the 1,500 shares of Gordon, Inc., common, @ $45 less fees of $1,200. Bought 700 shares of Earnhart Corp., common, @ $75 plus fees of $1,200.