Homework Help is Here – Start Your Trial Now!
Business
Accounting
Cullumber Company acquired 28% of the outstanding common stock of Grinwold Inc. on January 1, 2020, by paying $1,555,400 for 55,550 shares. Grinwold declared and paid a $0.50 per share cash dividend on June 30 and again on December 31, 2020. Grinwold reported net income of $859,200 for the year. (a) Your Answer Correct Answer Your answer is partially correct. Prepare the journal entries for Cullumber Company for 2020, assuming Cullumber cannot exercise significant influence over Grinwold. (Use the cost method.) (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) Date Jan. 1 June 30 v Dec. 31 Account Titles and Explanation Stock Investments Cash Cash Stock Investments Stock Investments Revenue from Stock Investments Debit 1555400 27775 27775 Credit 15554 277 277

Cullumber Company acquired 28% of the outstanding common stock of Grinwold Inc. on January 1, 2020, by paying $1,555,400 for 55,550 shares. Grinwold declared and paid a $0.50 per share cash dividend on June 30 and again on December 31, 2020. Grinwold reported net income of $859,200 for the year. (a) Your Answer Correct Answer Your answer is partially correct. Prepare the journal entries for Cullumber Company for 2020, assuming Cullumber cannot exercise significant influence over Grinwold. (Use the cost method.) (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) Date Jan. 1 June 30 v Dec. 31 Account Titles and Explanation Stock Investments Cash Cash Stock Investments Stock Investments Revenue from Stock Investments Debit 1555400 27775 27775 Credit 15554 277 277

Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
ChapterA2: Investments
Section: Chapter Questions
Problem 25E
See similar textbooks
icon
Related questions
Question
Cullumber Company acquired 28% of the outstanding common stock of Grinwold Inc. on January 1, 2020, by paying $1,555,400 for 55,550 shares. Grinwold declared and paid a $0.50 per share cash dividend on June 30 and again on December 31, 2020. Grinwold reported net income of $859,200 for the year. (a) Your Answer Correct Answer Prepare the journal entries for Cullumber Company for 2020, assuming Cullumber cannot exercise significant influence over Grinwold. (Use the cost method.) (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) (b) Your answer is partially correct. Date Jan. 1 June 30 Dec. 31 Solution List of Accounts Jan. 1 (c2) Date June 30 eTextbook and Media Dec. 31 Dec. 31 Account Titles and Explanation V Stock Investments Your answer is correct. Cash Prepare the journal entries for Cullumber Company for 2020, assuming Cullumber can exercise significant influence over Grinwold. (Use the equity method.) (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) Cash cash Stock Investments Stock Investments Account Titles and Explanation Save for Later Stock Investments Revenue from Stock Investments Cash Cash Stock Investments Stock Investments (To record dividends) List of Accounts Stock Investments Stock Investments Dividend Revenue Revenue from Stock Investments (To record 28% equity) eTextbook and Media List of Accounts Revenue From Stock Investments eTextbook and Media Cost Method Debit $ ||| 1555400 Debit Equity Method 27775 27775 1555400 27775 27775 240576 Credit Shows in tabular form the account balances under each method at December 31, 2020. (Do not leave any answer field blank. Enter O for amounts.) Credit Attempts: 0 of 5 used 15554 277 277 1555400 27775 27775 240576 Attempts: 1 of 5 used Submit Answer
Transcribed Image Text:Cullumber Company acquired 28% of the outstanding common stock of Grinwold Inc. on January 1, 2020, by paying $1,555,400 for 55,550 shares. Grinwold declared and paid a $0.50 per share cash dividend on June 30 and again on December 31, 2020. Grinwold reported net income of $859,200 for the year. (a) Your Answer Correct Answer Prepare the journal entries for Cullumber Company for 2020, assuming Cullumber cannot exercise significant influence over Grinwold. (Use the cost method.) (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) (b) Your answer is partially correct. Date Jan. 1 June 30 Dec. 31 Solution List of Accounts Jan. 1 (c2) Date June 30 eTextbook and Media Dec. 31 Dec. 31 Account Titles and Explanation V Stock Investments Your answer is correct. Cash Prepare the journal entries for Cullumber Company for 2020, assuming Cullumber can exercise significant influence over Grinwold. (Use the equity method.) (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) Cash cash Stock Investments Stock Investments Account Titles and Explanation Save for Later Stock Investments Revenue from Stock Investments Cash Cash Stock Investments Stock Investments (To record dividends) List of Accounts Stock Investments Stock Investments Dividend Revenue Revenue from Stock Investments (To record 28% equity) eTextbook and Media List of Accounts Revenue From Stock Investments eTextbook and Media Cost Method Debit $ ||| 1555400 Debit Equity Method 27775 27775 1555400 27775 27775 240576 Credit Shows in tabular form the account balances under each method at December 31, 2020. (Do not leave any answer field blank. Enter O for amounts.) Credit Attempts: 0 of 5 used 15554 277 277 1555400 27775 27775 240576 Attempts: 1 of 5 used Submit Answer
Expert Solution
steps

Step by step

Solved in 2 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Consolidations
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
Recommended textbooks for you
Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
SWFT Comprehensive Volume 2019
SWFT Comprehensive Volume 2019
Accounting
ISBN:
9780357233306
Author:
Maloney
Publisher:
Cengage
SWFT Corp Partner Estates Trusts
SWFT Corp Partner Estates Trusts
Accounting
ISBN:
9780357161548
Author:
Raabe
Publisher:
Cengage
SWFT Comprehensive Vol 2020
SWFT Comprehensive Vol 2020
Accounting
ISBN:
9780357391723
Author:
Maloney
Publisher:
Cengage
SEE MORE TEXTBOOKS