On June 1, 2024, Sam's Restaurant decides to invest excess cash of $56,000 from the tourist season by purchasing a Bison, Inc. bond at face value. At year-end, December 31, 2024, Bison's bond had a market value of $52,200. The investment is categorized as an available-for-sale debt investment and will be held for the short-term 1. Journalize the transactions for Sam's investment in Bison, Inc. for 2024. 2. In what category and at what value would Sam report the asset on the December 31, 2024, balance sheet? In what account would the market price change in Bison's stock be reported, if at all? 3. What was the net effect of the investment on Sam's net income for the year ended December 31, 2024?
On June 1, 2024, Sam's Restaurant decides to invest excess cash of $56,000 from the tourist season by purchasing a Bison, Inc. bond at face value. At year-end, December 31, 2024, Bison's bond had a market value of $52,200. The investment is categorized as an available-for-sale debt investment and will be held for the short-term 1. Journalize the transactions for Sam's investment in Bison, Inc. for 2024. 2. In what category and at what value would Sam report the asset on the December 31, 2024, balance sheet? In what account would the market price change in Bison's stock be reported, if at all? 3. What was the net effect of the investment on Sam's net income for the year ended December 31, 2024?
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
Chapter4: The Balance Sheet And The Statement Of Shareholders' Equity
Section: Chapter Questions
Problem 5RE
Related questions
Question
On
June
1,
2024,
Sam's
Restaurant decides to invest excess cash of
$56,000
from the tourist season by purchasing a
Bison,
Inc. bond at face value. At year-end, December 31,
2024,
Bison's
bond had a market value of
$52,200.
The investment is categorized as an available-for-sale debt investment and will be held for the short-term
|
1.
|
Journalize the transactions for
Sam's
investment in
Bison,
Inc. for
2024.
|
|
2.
|
In what category and at what value would
Sam
report the asset on the December 31,
2024,
balance sheet? In what account would the market price change in
Bison's
stock be reported, if at all? |
|
3.
|
What was the net effect of the investment on
Sam's
net income for the year ended December 31,
2024?
|
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