Available-for-Sale Securities On December 31, 2015, Marsh Company held 1,000 shares of Xenon Company common stock in its portfolio of available-for-sale securities. The stock had cost $15 per share and has a current market value of $13 per share. The December 31, 2015, balance sheet showed the following: Assets Investment in available-for-sale securities Less: Allowance for change in value of investment Shareholders' Equity Unrealized holding gain/loss $15,000 (2,000) $13,000 $ (2,000) During 2016, Marsh acquired 900 shares of Yellow Company common stock for $18 per share and 800 shares of Zebra Company common stock for $22 per share. At the end of 2016, the respective market values per share were: Xenon, $14; Yellow, $17; and Zebra, $20. Required: 1. Prepare the journal entries necessary to record the purchase of the investments in 2016 and the adjusting entry needed on December 31, 2016. 2. What would Marsh disclose on its December 31, 2016, balance sheet related to these investments?
Q: Salmone Company reported the following purchases and sales of its only product. Salmone uses a…
A: Inventory is valued on the basis of different inventory valuation methods such as LIFO, FIFO, or…
Q: Henna Company produces and sells two products, Carvings and Mementos. It manufactures these products…
A: HENNA Company contribution margin…
Q: Pharoah Company purchased 200 of the 1000 outstanding shares of Sheridan Company's common stock for…
A: The balance in equity investment refers to the value of an investment in a company's stock or…
Q: Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near…
A: Planning budget is based on Budgeted level of activity volume. It includes revenues and costs based…
Q: All of the following are true regarding the management and monitoring of cash except O companies may…
A: In accounting, cash refers to the money and other forms of currency, such as coins, banknotes, and…
Q: Required information [The following information applies to the questions displayed below.] Fitness…
A: Introduction: Return on investment is the formula used for calculation of percentage of return…
Q: Exercise 4-7 (Algo) Income statement presentation; discontinued operations; restructuring costs…
A: Discontinued Operations - Discontinued Operations is operation not continued by the business due to…
Q: Ayres Services acquired an asset for $96 million in 2024. The asset is depreciated for financial…
A: The asset which has been acquired is for the $96 Million in 2024 The tax rate is 25% Book method of…
Q: Minnie Mouse purchases a vehicle for $40,000 on July 1, 2019. The vehicle is expected to have a…
A: Depreciation - is one of the expense elements of the income statement which is described as a…
Q: Variable and absorption costing, explaining operating-income differences. Nascar Motors assembles…
A: Notes : Absorption costing: Absorption costing is compulsory under Generally Accepted Accounting…
Q: Determine the amount of borrowing costs to be capitalized and expensed.
A: Borrowing costs are interest and other costs incurred by an entity in connection with the borrowing…
Q: Purpose and importance of budgeting.
A: Budgeting is the process of creating a plan to allocate financial resources over a specific period,…
Q: Problem 1-18 (Static) Direct and Indirect Costs; Variable Costs [LO1-1, LO1-4] The following cost…
A: Direct cost :— It is the cost that are directly traceable to the particular product. Indirect…
Q: The November monthly factory overhead cost budget for Brass Ltd. at normal capacity of 10,000 units…
A: Lets understand the basics. Management prepares budget in order to estimate future profit and loss…
Q: Topic: Accounts, Debits and Credits 1. Analyze in detail: Introduction to the study of financial…
A: “Since you have posted multiple questions, we will provide the solution only to the first question…
Q: Sunland Company compiled the following financial information as of December 31, 2020: Revenues…
A: Owner's equity refers to the portion of a company's assets that belongs to its owners, also known as…
Q: A note dated June 1, 1995, calls for the payment of $85,000 in 6 years. On March 15, 1998, the note…
A: Present value refers to money received today being more valuable than the money will receive in…
Q: Case Vendor payment transactions are recorded on the correct dates. Assertion 4 Objective Accuracy…
A: Assertion: The vendor payment transactions are recorded on the correct dates. Objective: To ensure…
Q: Cost of Materials Issuances Under the FIFO Method An incomplete subsidiary ledger of materials…
A: Proper inventory presentation is important for investors to understand a company's financial…
Q: For each separate situation, indicate whether Cruz Company should (a) record a liability, (b)…
A: 1. Cruz company guarantees the $101,000 debt of a supplier. It is not probable that the supplier…
Q: Which is most likely when the assessed level of control risk increases? Use larger sample sizes for…
A: Control risk refers to the risk that a company's internal controls may not prevent or detect errors…
Q: Anny takes out an installment loan to finance the purchase of a pickup truck costing $14,100. Her…
A: Deferred payment price refers to a pricing model where the buyer is allowed to pay for a product or…
Q: A company has only one product and has provided the following data concerning its most recent month…
A: PRODUCT COST Product Cost are those Cost which is associates with the Manufacturing of Product.…
Q: Tax-deferred annuities pay no taxes on the income placed into the account but then pay taxes on all…
A: Future value of amount include the amount that is being deposited and amount of interest accumulated…
Q: About the corporate cost; Allocate the $20,000,000 million corporate headquarters cost of Bright…
A: Allocation of Corporate Headquarters Costs to Subsidiaries refers to the process of dividing the…
Q: Crane Sports Inc. manufactures basketballs for the Women's National Basketball Association (WNBA).…
A: The differential analysis is performed to analyze the effect of special order on revenues and…
Q: Halifax Manufacturing allows its customers to return merchandise for any reason up to 90 days after…
A: Answer:- Refund liability:- The amount of consideration that will be reimbursed to consumers that…
Q: During the first month of operations ended July 31, Head Gear Inc. manufactured 25,600 hats, of…
A: NOTE: Since you have posted a question with multiple sub parts, we will provide the solution only to…
Q: A weight-loss program advertises a person can attain an average weight loss of 4 pounds per week.…
A: Weight-loss programs are advertised with different claims of weight loss per week. This question…
Q: Exercise 2: On January 1, 2019, JWS Corporation issued $600,000 of 7% bonds, due in 10 years. The…
A: The question is based on the concept of Financial Accounting. >Bonds Payable are the source…
Q: By reference to the data in part A above: Explain thoroughly 1. There are both quantitative and…
A: the answer to the questions are given below.
Q: What is the difference between a liability and an expense in accounting?
A: A company's future debt or obligation to a third party is known as a liability. This can include…
Q: What is the difference between the reimbursement cycle in most healthcare facilities and the coding…
A: In general, the reimbursement cycle in healthcare facilities involves the process of submitting…
Q: In today's fast-paced business environment, decision making is a critical task for managers. Making…
A: Introduction: Make or buy decision directly depends on the relevant cost and savings. The relevant…
Q: QUESTION: 1. Work Related Car Expenes (3800 Km + 500 Km) * $0.72 per Km? May know which method are…
A: Use the cents per KM method if you are claiming less than 5000km. Use the logbook method if you are…
Q: Required: Prepare a flexible budget performance report for the year. (Indicate the effect of each…
A: Variable cost per unit Remains same however the Total Variable Cost will be changing with the Change…
Q: The summarized balance sheets of Pharoah Company and Sheridan Company as of December 31, 2025 are as…
A: Equity Method - The equity method is a method where investment made by the company is initially…
Q: Required information [The following information applies to the questions displayed below] At…
A: Account Receivable $210,000.00 Less: Allowance for Doubtful Account $15,100.00…
Q: The units in beginning work in proces inventory are 70% complete with respect to conversion costs…
A: Conversion costs are costs incurred to convert the raw material or direct material into the finished…
Q: Stellar Lumber Company handles three principal lines of merchandise with these varying rates of…
A: The method chosen for inventory valuation can have a significant impact on the financial statements…
Q: What will deposits of $470.00 made at the end of each month amount to after seven years if interest…
A: FV stands for Future value which refers to value of the current asset at the future date that is…
Q: Exercise 4-19A (Algo) Using common size statements and ratios to make comparisons LO 4-8 The…
A: Common Size Statement - Total Sales will be considered as 100% and other Income Statement items will…
Q: A company has provided the following data for its two most recent years of operation: Selling price…
A: Factory overhead, also known as manufacturing overhead or indirect manufacturing costs, refers to…
Q: As presented in the previous page, the typical sources and uses of cash for a business are:…
A: Operating Cash Flow: One example of operating cash flow for a restaurant business would be revenue…
Q: Exercise 4-7A (Algo) Determining the cost of inventory LO 4-2, 4-3, 4-4 For each of the following…
A: The ending inventory consists of the units are that are not sold at the end of accounting period.…
Q: Problem 1 Meredith Company provided the following information: January 1,2020 December…
A: Allowance for doubtful accounts means where account receivables are not going to recover in full and…
Q: 4. Direct lapor Duaget. 5. Factory overhead budget. 6. Selling expense budget. 7. General and…
A: SALES BUDGET Sales Budget is the quantitative & Financial statement of Sales, Prepared prior to…
Q: t took a Korean shipyard 125,000 labor-hours to produce the first of several tugboats that you…
A: The learning factor of 85% means that for each unit produced, the labor-hours required decrease by…
Q: Problem 9-34 (LO. 6) Harvey is a self-employed accountant with earned income from the business of…
A: The planning for retirement is necessary and there are exemptions also available for that but there…
Q: Calculate the total cost, total depreciation, and annual depreciation (in $) for the following…
A: Depreciation refers to an amount that diminishes teh value of an asset due to obsolescence, wear…
Do not give answer in image
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- 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?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 lossTrading Securities Pear Investments began operations in 2020 and invests in securities classified as trading securities. During 2020, it entered into the following trading security transactions: Purchased 20,000 shares of ABC common stock at $38 per share Purchased 32,000 shares of XYZ common stock at $17 per share At December 31, 2020, ABC common stock was trading at $39.50 per share and XYZ common stock was trading at $16.50 per share. Required: 1. Prepare the necessary adjusting entry to value the trading securities at fair market value. 2. CONCEPTUAL CONNECTION What is the income statement effect of this adjusting entry?
- Selected transactions completed by Equinox Products Inc. during the fiscal year ended December 31, 2016, were as follows: a. Issued 15,000 shares of 0 par common stock at 0, receiving cash. b. Issued 4,000 shares of 80 par preferred 5% stock at 100, receiving cash. c. Issued 500,000 of 10-year, 5% bonds at 104, with interest payable semiannually. d. Declared a quarterly dividend of 0.50 per share on common stock and 1.00 per share on preferred stock. On the date of record, 100,000 shares of common stock were outstanding, no treasury shares were held, and 20,000 shares of preferred stock were outstanding. e. Paid the cash dividends declared in (d). f. Purchased 7,500 shares of Solstice Corp. at 40 per share, plus a 150 brokerage commission. The investment is classified as an available-for-sale investment. g. Purchased 8,000 shares of treasury common stock at 33 per share. h. Purchased 40,000 shares of Pinkberry Co. stock directly from the founders for 24 per share. Pinkberry has 125,000 shares issued and outstanding. Equinox Products Inc. treated the investment as an equity method investment. i. Declared a 1.00 quarterly cash dividend per share on preferred stock. On the date of record, 20,000 shares of preferred stock had been issued. j. Paid the cash dividends to the preferred stockholders. k. Received 27,500 dividend from Pinkberry Co. investment in (h). l. Purchased 90,000 of Dream Inc. 10-year, 5% bonds, directly from the issuing company, at their face amount plus accrued interest of 375. The bonds are classified as a held- to-maturitv long-term investment. m. Sold, at 38 per share, 2,600 shares of treasury common stock purchased in (g). n. Received a dividend of 0.60 per share from the Solstice Corp. investment in (f). o. Sold 1,000 shares of Solstice Corp. at 545, including commission. p. Recorded the payment of semiannual interest on the bonds issued in (c) and the amortization of the premium for six months. The amortization is determined using the straight-line method, q. Accrued interest for three months on the Dream Inc. bonds purchased in (1). r. Pinkberry Co. recorded total earnings of 240,000. Equinox Products recorded equity earnings for its share of Pinkberry Co. net income. s. The fair value for Solstice Corp. stock was 39.02 per share on December 31, 2016. The investment is adjusted to fair value, using a valuation allowance account. Assume Valuation Allowance for Available-for-Sale Investments had a beginning balance of zero. Instructions Journalize the selected transactions. After all of the transactions for the year ended December 31, 2016, had been posted [including the transactions recorded in part (1) and all adjusting entries], the data that follows were taken from the records of Equinox Products Inc. a. Prepare a multiple-step income statement for the year ended December 31, 2016, concluding with earnings per share. In computing earnings per share, assume that the average number of common shares outstanding was 100,000 and preferred dividends were 100,000. (Round earnings per share to the nearest cent.) b. Prepare a retained earnings statement for the year ended December 31, 2016. c. Prepare a balance sheet in report form as of December 31, 2016. Income statement data: Advertising expense 150,000 Cost of merchandise sold 3,700,000 Delivery expense 30,000 Depreciation expense -office buildings and equipment 30,000 Depreciation expensestore buildings and equipment 100,000 Dividend revenue 4,500 Gain on sale of investment 4,980 Income from Pinkberry Co. investment 76,800 Income tax expense 140,500 Interest expense 21,000 Interest revenue 2,720 Miscellaneous administrative expense 7.500 Miscellaneous selling expense 14,000 Office rent expense 50,000 Office salaries expense 170,000 Office supplies expense 10,000 Sales 5,254,000 Sales commissions 185,000 Sales salaries expense 385,000 Store supplies expense 21,000 Retained earnings and balance sheet data: Accounts payable 194,300 Accounts receivable 545,000 Accumulated depreciationoffice buildings and equipment 1,580,000 Accumulated depreciationstore buildings and equipment 4,126,000 Allowance for doubtful accounts 8,450 Available for sale investments (at cost) 260,130 Bonds payable. 5%. due 2024 500,000 Cash 246,000 Common stock, 20 par (400,000 shares authorized; 100,000 shares issued. 94,600 outstanding) 2,000,000 Dividends: Cash dividends for common stock 155,120 Cash dividends for preferred stock 100,000 Goodwill 500,000 Income tax payable 44,000 Interest receivable 1,125 Investment in Pinkberry Co. stock (equity method) 1,009,300 Investment in Dream Inc. bonds (long term) 90,000 Merchandise inventory [December 31, 2016). at lower of cost (FIFO) or market 778,000 Office buildings and equipment 4.320,000 Paid-in capital from sale of treasury stock 13,000 Excess of issue price over parcommon stock 886,800 Excess of issue price over parpreferred stock 150,000 Preferred 5% stock. 80 par (30,000 shares authorized; 20,000 shares issued] 1,600,000 Premium on bonds payable 19,000 Prepaid expenses 27,400 Retained earnings, January 1, 2016 9,319,725 Store buildings and equipment 12,560,000 Treasury stock (5,400 shares of common stock at cost of 33 per share) 178,200 Unrealized gain (loss) on available for sale investments (6,500) Valuation allowance for available for sale investments (6,500)Selected transactions completed by Equinox Products Inc. during the fiscal year ended December 31, 2016, were as follows: a. Issued 15,000 shares of 20 par common stock at 30, receiving cash. b. Issued 4,000 shares of 80 par preferred 5% stock at 100, receiving cash. c. Issued 500,000 of 10-year, 5% bonds at 104, with interest payable semiannually. d. Declared a quarterly dividend of 0.50 per share on common stock and 1.00 per share on preferred stock. On the date of record, 100,000 shares of common stock were outstanding, no treasury shares were held, and 20,000 shares of preferred stock were outstanding. e. Paid the cash dividends declared in (d). f. Purchased 7,500 shares of Solstice Corp. at 40 per share, plus a 150 brokerage commission. The investment is classified as an available-for-sale investment. g. Purchased 8,000 shares of treasury common stock at 33 per share. h. Purchased 40,000 shares of Pinkberry Co. stock directly from the founders for 24 per share. Pinkberry has 125,000 shares issued and outstanding. Equinox Products Inc. treated the investment as an equity method investment. i. Declared a 1.00 quarterly cash dividend per share on preferred stock. On the date of record, 20,000 shares of preferred stock had been issued. j. Paid the cash dividends to the preferred stockholders. k. Received 27,500 dividend from Pinkberry Co. investment in (h). l. Purchased 90,000 of Dream Inc. 10-year, 5% bonds, directly from the issuing company, at their face amount plus accrued interest of 375. The bonds are classified as a heldtomaturity long-term investment. m. Sold, at 38 per share, 2,600 shares of treasury common stock purchased in (g). n. Received a dividend of 0.60 per share from the Solstice Corp. investment in (f). o. Sold 1,000 shares of Solstice Corp. at 45, including commission. p. Recorded the payment of semiannual interest on the bonds issued in (c) and the amortization of the premium for six months. The amortization is determined using the straight-line method. q. Accrued interest for three months on the Dream Inc. bonds purchased in (l). r. Pinkberry Co. recorded total earnings of 240,000. Equinox Products recorded equity earnings for its share of Pinkberry Co. net income. s. The fair value for Solstice Corp. stock was 39.02 per share on December 31, 2016. The investment is adjusted to fair value, using a valuation allowance account. Assume Valuation Allowance for Available-for-Sale Investments had a beginning balance of zero. Instructions 1. Journalize the selected transactions. 2. After all of the transactions for the year ended December 31, 2016, had been posted [including the transactions recorded in part (1) and all adjusting entries], the data that follows were taken from the records of Equinox Products Inc. a. Prepare a multiple-step income statement for the year ended December 31, 2016, concluding with earnings per share. In computing earnings per share, assume that the average number of common shares outstanding was 100,000 and preferred dividends were 100,000. (Round earnings per share to the nearest cent.) b. Prepare a retained earnings statement for the year ended December 31, 2016. c. Prepare a balance sheet in report form as of December 31, 2016.Parilo Company acquired 170,000 of Makofske Co., 5% bonds on May 1, 2016, at their face amount. Interest is paid semiannually on May 1 and November 1. On November 1, 2016, Parilo Company sold 50,000 of the bonds for 96. Journalize entries to record the following: a. The initial acquisition of the bonds on May 1. b. The semiannual interest received on November 1. c. The sale of the bonds on November 1. d. The accrual of 1,000 interest on December 31, 2016.
- Frost Company has accumulated the following information relevant to its 2019 earningsper share. 1. Net income for 2019: 150,500. 2. Bonds payable: On January 1, 2019, the company had issued 10%, 200,000 bonds at 110. The premium is being amortized in the amount of 1,000 per year. Each 1,000 bond is currently convertible into 22 shares of common stock. To date, no bonds have been converted. 3. Bonds payable: On December 31, 2017, the company had issued 540,000 of 5.8% bonds at par. Each 1,000 bond is currently convertible into 11.6 shares of common stock. To date, no bonds have been converted. 4. Preferred stock: On July 3, 2018, the company had issued 3,800 shares of 7.5%, 100 par, preferred stock at 108 per share. Each share of preferred stock is currently convertible into 2.45 shares of common stock. To date, no preferred stock has been converted and no additional shares of preferred stock have been issued. The current dividends have been paid. 5. Common stock: At the beginning of 2019, 25,000 shares were outstanding. On August 3, 7,000 additional shares were issued. During September, a 20% stock dividend was declared and issued. On November 30, 2,000 shares were reacquired as treasury stock. 6. Compensatory share options: Options to acquire common stock at a price of 33 per share were outstanding during all of 2019. Currently, 4,000 shares may be acquired. To date, no options have been exercised. The unrecognized compens Frost Company has accumulated the following information relevant to its 2019 earnings ns is 5 per share. 7. Miscellaneous: Stock market prices on common stock averaged 41 per share during 2019, and the 2019 ending stock market price was 40 per share. The corporate income tax rate is 30%. Required: 1. Compute the basic earnings per share. Show supporting calculations. 2. Compute the diluted earnings per share. Show supporting calculations. 3. Indicate which earnings per share figure(s) Frost would report on its 2019 income statement.OBrien Industries Inc. is a book publisher. The comparative unclassified balance sheets for December 31, 2017 and 2016 follow. Selected missing balances are shown by letters. Note 1. Investments are classified as available for sale. The investments at cost and fair value on December 31, 2016, are as follows: Note 2. The investment in Jolly Roger Co. stock is an equity method investment representing 30% of the outstanding shares of Jolly Roger Co. The following selected investment transactions occurred during 2017: May 5. Purchased 3,080 shares of Gozar Inc. at 30 per share including brokerage commission. Gozar Inc. is classified as an available-for-sale security. Oct. 1. Purchased 40,000 of Nightline Co. 6%, 10-year bonds at 100. The bonds are classified as available for sale. The bonds pay interest on October 1 and April 1. 9. Dividends of 12,500 are received on the Jolly Roger Co. investment. Dec. 31. Jolly Roger Co. reported a total net income of 112,000 for 2017. OBrien Industries Inc. recorded equity earnings for its share of Jolly Roger Co. net income. 31. Accrued three months of interest on the Nightline bonds. 31. Adjusted the available-for-sale investment portfolio to fair value, using the following fair value per-share amounts: 31. Closed the OBrien Industries Inc. net income of 146,230. OBrien Industries Inc. paid no dividends during the year. Instructions Determine the missing letters in the unclassified balance sheet. Provide appropriate supporting calculations.Tama Companys capital structure consists of common stock and convertible bonds. At the beginning of 2019, Tama had 15,000 shares of common stock outstanding; an additional 4,500 shares were issued on May 4. The 7% convertible bonds have a face value of 80,000 and were issued in 2016 at par. Each 1,000 bond is convertible into 25 shares of common stock; to date, none of the bonds have been converted. During 2019, the company earned net income of 79,200 and was subject to an income tax rate of 30%. Required: Compute the 2019 diluted earnings per share.