Pine Company makes an investment in Holt Company. Journalize the following transactions assuming that Pine Company uses (a) the fair value method and (b) the equity method for its investment in Holt Company: 1) On Jan. 1, 2017, Pine bought 30% of Holt’s common stock. Total book value of all Holt’s common stock was $800,000 on this date. 2) During 2017, Holt reported $40,000 of net income. 3) During 2017, Holt paid $20,000 of dividends
Pine Company makes an investment in Holt Company. Journalize the following transactions assuming that Pine Company uses (a) the fair value method and (b) the equity method for its investment in Holt Company: 1) On Jan. 1, 2017, Pine bought 30% of Holt’s common stock. Total book value of all Holt’s common stock was $800,000 on this date. 2) During 2017, Holt reported $40,000 of net income. 3) During 2017, Holt paid $20,000 of dividends
Financial Accounting
14th Edition
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Carl Warren, Jim Reeve, Jonathan Duchac
Chapter15: Investments And Fair Value Accounting
Section: Chapter Questions
Problem 13E
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Pine Company makes an investment in Holt Company. Journalize the following transactions assuming that Pine Company uses (a) the fair value method and (b) the equity method for its investment in Holt Company:
1) On Jan. 1, 2017, Pine bought 30% of Holt’s common stock. Total book value of all Holt’s common stock was $800,000 on this date.
2) During 2017, Holt reported $40,000 of net income.
3) During 2017, Holt paid $20,000 of dividends
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