Purchased 7,500 shares of Solstice Corp. at $40 per share plus a $150 brokerage commission. The investment is classified as an available-for-sale investment. Purchased 8,000 shares of treasury common stock at $33 per share. Purchased 40,000 shares of Pinkberry Co. stock directly from the founders for $24 per share. Pinkberry has 125,000 shares issued and outstanding. Equinox Products Inc. treated the investment as an equity method investment. Declared a $1.00 quarterly cash dividend per share on preferred stock. On the date of record, 20,000 shares of preferred stock had been issued. Paid the cash dividends to the preferred stockholders. Received $27,500 dividend from Pinkberry Co. investment in (h). Purchased $90,000 of Dream Inc. 10-year, 5% bonds, directly from the issuing company, at their face amount plus accrued interest of $375. The bonds are classified as a held-to-maturity long-term investment. Sold, at $38 per share, 2,600 shares of treasury common stock purchased in (g). Received a dividend of $0.60 per share from the Solstice Corp. investment in (f). Sold 1,000 shares of Solstice Corp. at $45, including commission. Recorded the payment of semiannual interest on the bonds issued in (c) and the amortization of the premium for six months. The amortization is determined using the straight-line method. Accrued interest for three months on the Dream Inc. bonds purchased in (l). Pinkberry Co. recorded total earnings of $240,000. Equinox Products recorded equity earnings for its share of Pinkberry Co. net income. The fair value for Solstice Corp. stock was $39.02 per share on December 31, Year 1. The investment is adjusted to fair value, using a valuation allowance account. Assume that Valuation Allowance for Available-for-Sale Investments had a beginning balance of zero. Prepare a journal entries
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Purchased 7,500 shares of Solstice Corp. at $40 per share plus a $150 brokerage commission. The investment is classified as an available-for-sale investment.
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Purchased 8,000 shares of
treasury common stock at $33 per share. -
Purchased 40,000 shares of Pinkberry Co. stock directly from the founders for $24 per share. Pinkberry has 125,000 shares issued and outstanding. Equinox Products Inc. treated the investment as an equity method investment.
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Declared a $1.00 quarterly cash dividend per share on
preferred stock . On the date of record, 20,000 shares of preferred stock had been issued. -
Paid the cash dividends to the preferred stockholders.
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Received $27,500 dividend from Pinkberry Co. investment in (h).
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Purchased $90,000 of Dream Inc. 10-year, 5% bonds, directly from the issuing company, at their face amount plus accrued interest of $375. The bonds are classified as a held-to-maturity long-term investment.
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Sold, at $38 per share, 2,600 shares of treasury common stock purchased in (g).
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Received a dividend of $0.60 per share from the Solstice Corp. investment in (f).
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Sold 1,000 shares of Solstice Corp. at $45, including commission.
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Recorded the payment of semiannual interest on the bonds issued in (c) and the amortization of the premium for six months. The amortization is determined using the straight-line method.
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Accrued interest for three months on the Dream Inc. bonds purchased in (l).
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Pinkberry Co. recorded total earnings of $240,000. Equinox Products recorded equity earnings for its share of Pinkberry Co. net income.
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The fair value for Solstice Corp. stock was $39.02 per share on December 31, Year 1. The investment is adjusted to fair value, using a valuation allowance account. Assume that Valuation Allowance for Available-for-Sale Investments had a beginning balance of zero.
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