Journalize the transactions.11. Jan. 1Purchase 40, $1,000 Carlos Company 8% bonds for $40,000. Interest is payable annually on January 1. (a) Journalize thetransactions, and (b) prepare the adjusting entry for the accrual of interest on December 31.12. Jan. 1 On January 1, 2022, Carlos Corporation acquires 1,000 shares (8% ownership) of Tele Corporation common stock at $20 per share.Journalize the purchase of shares.13. Reference question #12 above. If Carlos Corporation receives a $3 per share dividend on July 31, record the dividend revenue.114. Assume that Carlos Corporation receives a net proceeds of $39,000 on the sale of its Tele Corporation Stock on March 2023 (Question #12above). Record the sale of shares.15. Assume that Carlos Corporation acquires 40% of the common stock of Tele Company for $200,000 on January 1, 2022. Record thetransaction.16. For 2022, Tele Corporations reports net income of $100,000. It declares and pays a $$60,000 cash dividend. Journalize the revenue anddividends transactions (Ref: #15 above).17. Post to ledgers (use T-Accounts) for #15 and #16 above.

The cost method is used to record the equity investment when the company acquires less number of…

Answered: Journalize the transactions. 11. Jan, 1…

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter7: Receivables And Investments

Section: Chapter Questions

Problem 7.5P

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Transfer between Categories On December 31, 2018, Leslie Company held an investment in bonds of Kaufmann Company which it categorized as being held to maturity. At that time, the 8%, 100,000 face value bonds had a carrying value of 107,023.56 and were being amortized using the effective interest method based on a market rate of 7%. Interest on these bonds is paid annually each December 31. On December 31, 2019, after recording the interest earned, Leslie decided to reclassify the Kaufmann bonds to its available-for-sale category in anticipation of a major restructuring. At that time, the ending quoted market price for the bonds was 105,000. Required: Prepare the journal entries on December 31, 2019, to record the interest earned and the reclassification.
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.
Whirlie Inc. issued $300,000 face value, 10% paid annually, 10-year bonds for $319,251 when the market of interest was 9%. The company uses the effective-interest method of amortization. At the end of the year, the company will record ________. A. a credit to cash for $28,733 B. a debit to interest expense for $31,267 C. a debit to Discount on Bonds Payable for $1,267 D. a debit to Premium on Bonds Payable for $1.267

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Journalize the transactions. 11. Jan, 1 Purchase 40, $1,000 Carlos Company 8% bonds for $40,000. Interest is payable annually on January 1. (a) Journalize the transactions, and (b) prepare the adjusting entry for the accrual of interest on December 31.