In January 2022, the management of Pharoah Company concludes that it has sufficient cash to permit some short-term investments in debt and equity securities. During the year, the following transactions occurred. Feb. 1 Purchased 500 shares of Muninger common stock for $25,000. Mar. 1 Purchased 700 shares of Tatman common stock for $17,500. Apr. 1 Purchased 70 of $1.020, 8% Yoakem bonds for $71,400. Interest is payable semiannually on April 1 and October 1. July 1 Received a cash dividend of $0.60 per share on the Muninger common stock. Aug. 1 Sold 167 shares of Muninger common stock at $60 per share. Sept. 1 Received a $1 per share cash dividend on the Tatman common stock. Oct. 1 Received the semiannual interest on the Yoakem bonds. Oct. 1 Sold the Yoakem bonds for $70,200. At December 31. the fair value of the Muninger and Tatman common stocks were $51 and $24 per share respectively. These stock investments by Pharoah Company provide less than a 20% ownership interest.

Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter16: Retained Earnings And Earnings Per Share
Section: Chapter Questions
Problem 19E: Lyon Company shows the following condensed income statement information for the year ended December...
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(b)
Prepare the adjusting entry at December 31, 2022, to report the investment securities at fair value. All securities are considered
to be trading securities. (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.)
Account Titles and Explanation
Debit
Credit
Date
Dec. 31
eTextbook and Media
List of Accounts
Transcribed Image Text:(b) Prepare the adjusting entry at December 31, 2022, to report the investment securities at fair value. All securities are considered to be trading securities. (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.) Account Titles and Explanation Debit Credit Date Dec. 31 eTextbook and Media List of Accounts
In January 2022, the management of Pharoah Company concludes that it has sufficient cash to permit some short-term investments in
debt and equity securities. During the year, the following transactions occurred.
Feb. 1
Purchased 500 shares of Muninger common stock for $25,000.
Mar. 1
Purchased 700 shares of Tatman common stock for $17,500.
Apr. 1
Purchased 70 of $1.020, 8% Yoakem bonds for $71,400. Interest is payable semiannually on April 1 and October 1.
July 1
Received a cash dividend of $0.60 per share on the Muninger common stock.
Aug. 1
Sold 167 shares of Muninger common stock at $60 per share.
Sept. 1
Received a $1 per share cash dividend on the Tatman common stock.
Oct. 1
Received the semiannual interest on the Yoakem bonds.
Oct. 1
Sold the Yoakem bonds for $70,200.
At December 31, the fair value of the Muninger and Tatman common stocks were $51 and $24 per share respectively. These stock
investments by Pharoah Company provide less than a 20% ownership interest.
(a)
Transcribed Image Text:In January 2022, the management of Pharoah Company concludes that it has sufficient cash to permit some short-term investments in debt and equity securities. During the year, the following transactions occurred. Feb. 1 Purchased 500 shares of Muninger common stock for $25,000. Mar. 1 Purchased 700 shares of Tatman common stock for $17,500. Apr. 1 Purchased 70 of $1.020, 8% Yoakem bonds for $71,400. Interest is payable semiannually on April 1 and October 1. July 1 Received a cash dividend of $0.60 per share on the Muninger common stock. Aug. 1 Sold 167 shares of Muninger common stock at $60 per share. Sept. 1 Received a $1 per share cash dividend on the Tatman common stock. Oct. 1 Received the semiannual interest on the Yoakem bonds. Oct. 1 Sold the Yoakem bonds for $70,200. At December 31, the fair value of the Muninger and Tatman common stocks were $51 and $24 per share respectively. These stock investments by Pharoah Company provide less than a 20% ownership interest. (a)
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