GEN COMBO LOOSELEAF INTERMEDIATE ACCOUNTING; CONNECT ACCESS CARD
9th Edition
ISBN: 9781260089042
Author: J. David Spiceland
Publisher: McGraw-Hill Education
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter 12, Problem 12.12BE
To determine
Equity investments: The financial instruments which claim ownership in the issuing company and pay a dividend revenue to the investor company, are referred to as equity securities. The investments in equity securities are referred to as equity investments.
Equity method: Equity method is the method used for accounting equity investments which claim a significant influence of above 20% but less than 50% in the outstanding stock of the investee company.
To mention: The effect of dividend on the financial statements of Company T for 2018
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Question 8
At the end of 2020, Diego Corporation reported a $40,000 balance in its common share account
(stated value $5 per share). The treasury share account showed $720 (cost $6 per share). No
dividends were paid during the first two years. During 2020 the company declared and paid a cash
dividend at $1.50 per share. Calculate the total amount of the 2020 cash dividend.
PROBLEM 28 (AICPA Adapted)
Miraflores owned 10,000 shares in Maquiling Company acquired several years ago at P100 per share
to be held as a long-term investment. Beginning in 2015, Miraflores received a dividend of P40 per
share. Maquiling Company notifies the investor that a portion of this amount represented earnings
and the balance as liquidating dividends. The allocation to be made as follows:
Earned Dividend
Liquidating Dividend
2015
P40
2016
P10
Р30
2017
P15
P25
2018
P20
P20
2019
P25
P15
Requirements:
1. Prepare journal entries on the books of the investor from 2015 to 2019.
NDAN
PROBLEM 28 (AICPA Adapted)
Miraflores owned 10,000 shares in Maquiling Company acquired several years ago at
P100 per share to be held as a long-term investment. Beginning in 2015, Miraflores
received a dividend of P40 per share. Maquiling Company notifies the investor that a
portion of this amount represented earnings and the balance as liquidating dividends.
The allocation to be made as follows:
Earned Dividend
Liquidating Dividend
2015
P40
2016
P10
P30
2017
P15
P25
2018
P20
P20
2019
P25
P15
Requirements:
1. Prepare jourmal entries on the books of the investor from 2015 to 2019.
Chapter 12 Solutions
GEN COMBO LOOSELEAF INTERMEDIATE ACCOUNTING; CONNECT ACCESS CARD
Ch. 12 - All investments in debt securities are classified...Ch. 12 - When market rates of interest rise after a...Ch. 12 - Does GAAP distinguish between fair values that are...Ch. 12 - When a debt investment is acquired to be held for...Ch. 12 - Prob. 12.5QCh. 12 - What is comprehensive income? Its composition...Ch. 12 - Why are holding gains and losses treated...Ch. 12 - Prob. 12.8QCh. 12 - Prob. 12.9QCh. 12 - Prob. 12.10Q
Ch. 12 - Under IFRS No. 9, which reporting categories are...Ch. 12 - Prob. 12.12QCh. 12 - Do U.S. GAAP and IFRS differ in the amount of...Ch. 12 - Under what circumstances is the equity method used...Ch. 12 - The equity method has been referred to as a...Ch. 12 - In the application of the equity method, how...Ch. 12 - Prob. 12.17QCh. 12 - Prob. 12.18QCh. 12 - Prob. 12.19QCh. 12 - How does IFRS differ from U.S. GAAP with respect...Ch. 12 - What is the effect of a company electing the fair...Ch. 12 - Define a financial instrument. Provide three...Ch. 12 - Some financial instruments are called derivatives....Ch. 12 - (Based on Appendix 12A) Northwest Carburetor...Ch. 12 - Prob. 12.25QCh. 12 - Prob. 12.26QCh. 12 - (Based on Appendix 12B) Reporting an investment at...Ch. 12 - Prob. 12.28QCh. 12 - Explain how the CECL model (introduced in ASU No....Ch. 12 - Prob. 12.30QCh. 12 - Prob. 12.1BECh. 12 - Prob. 12.2BECh. 12 - Trading securities LO12-3 For the Coca-Cola bonds...Ch. 12 - Available -for-sale securities LO12-4 SL...Ch. 12 - Available -for-sale securities LO12-4 For the...Ch. 12 - Prob. 12.6BECh. 12 - Prob. 12.7BECh. 12 - Prob. 12.8BECh. 12 - Prob. 12.9BECh. 12 - Prob. 12.10BECh. 12 - Equity investments and dividends LO12-5 Turner...Ch. 12 - Prob. 12.12BECh. 12 - Prob. 12.13BECh. 12 - Equity method investments LO12-6, LO12-9 Kim...Ch. 12 - Change in principle; change to the equity method ...Ch. 12 - Fair value option; equity method investments ...Ch. 12 - Prob. 12.17BECh. 12 - Impairments (AFS Credit Loss Model) (Appendix 12B)...Ch. 12 - Prob. 12.19BECh. 12 - Prob. 12.20BECh. 12 - Prob. 12.1ECh. 12 - Prob. 12.2ECh. 12 - Securities held-to-maturity LO12-1 FFT...Ch. 12 - Prob. 12.4ECh. 12 - Prob. 12.5ECh. 12 - Trading securities LO12-1 [This is a variation of...Ch. 12 - Various transactions relating to trading...Ch. 12 - Prob. 12.8ECh. 12 - Securities available-for-sale; adjusting entries ...Ch. 12 - Available -for-sale securities LO12-1, LO12-4...Ch. 12 - Available -for-sale securities LO12-1, LO12-4...Ch. 12 - Available -for-sale securities LO12-1, LO12-4...Ch. 12 - Classification of securities; adjusting entries ...Ch. 12 - Prob. 12.14ECh. 12 - Equity investments; fair value through net income ...Ch. 12 - Equity investments; fair value through net income ...Ch. 12 - Prob. 12.17ECh. 12 - Equity investments; fair value through net income ...Ch. 12 - Investment securities and equity method...Ch. 12 - Equity method; purchase; investee income;...Ch. 12 - Error corrections; equity method investment ...Ch. 12 - Prob. 12.22ECh. 12 - Prob. 12.23ECh. 12 - Prob. 12.24ECh. 12 - Prob. 12.25ECh. 12 - Prob. 12.26ECh. 12 - Prob. 12.27ECh. 12 - Prob. 12.28ECh. 12 - Prob. 12.29ECh. 12 - Prob. 12.30ECh. 12 - Prob. 12.31ECh. 12 - Prob. 12.32ECh. 12 - Accounting for impairments under IFRS (Appendix...Ch. 12 - Prob. 12.1PCh. 12 - Prob. 12.2PCh. 12 - Securities available-for-sale; bond investment;...Ch. 12 - Prob. 12.4PCh. 12 - Various transactions related to trading securities...Ch. 12 - Various transactions related to securities...Ch. 12 - Prob. 12.7PCh. 12 - Various transactions relating to trading...Ch. 12 - Securities held-to-maturity; securities available...Ch. 12 - Investment securities and equity method...Ch. 12 - Prob. 12.11PCh. 12 - Prob. 12.12PCh. 12 - Prob. 12.13PCh. 12 - Equity method LO12-6, LO12-7 On January 2, 2018,...Ch. 12 - Prob. 12.15PCh. 12 - Prob. 12.16PCh. 12 - Accounting for debt and equity investments ...Ch. 12 - Prob. 12.18PCh. 12 - Real World Case 121 Intels investments LO12-4 The...Ch. 12 - Prob. 12.2BYPCh. 12 - Prob. 12.4BYPCh. 12 - Prob. 12.6BYPCh. 12 - Real World Case 127 Comprehensive income Microsoft...Ch. 12 - Continuing Cases Target Case LO12-4, LO12-6...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- The Mike Corporation’s statement of financial position shows total shareholders’ equity of P3,150,000 as of December 31, 2016. a. What is the book value per share, assuming that the company has only one class of share capital outstanding consisting of 50,000, P10 par ordinary shares?A. P10.00B. P63.00C. P70.20D. P73.00 b. What is the book value per ordinary share assuming that the company has two classes of share capital outstanding consisting of the following: 5,000, P100 par value preference shares with a liquidation value of P120 per share and 50,000, P10 par value ordinary shares?A. P10.00B. P51.00C. P53.00D. P63.00arrow_forwardPlease answer in good accounting form. Thankyou HAWKEYE Corporation has the following shareholders' equity accounts as of December 31, 2021: 6% Preference shares, ₱10 par - ₱200,000; Ordinary shares, ₱10 par - ₱300,000; Accumulated profits - ₱80,000. Dividends have not been declared for the years 2019 to 2021. The whole amount of the accumulated profits of ₱80,000 was declared as dividend on December 31, 2021. How much dividend per share shall an ordinary shareholder have if the preference share is cumulative and participating up to 21%?arrow_forwardEQUITY INVESTMENTS Problem 4 On January 1, 2018, ABC Company purchased 40,000 shares of RST at P100 per share. The investment in measurement at fair value through other comprehensive income. Brokerage fees measured to P120,000. A P5 dividend per share of RST had been declared on December 15, 2017 to be paid on March 31, 2018 to shareholders of record on January 31, 2018. No other transactions occurred in 2018 affecting the investment in RST shares. What is the initial measurement of the investment? 4,120,000 a. b. 4,000,000 c. 3,920,000 d. 3,800,000 Problem 5 Care Company received dividends from its share investments during the year ended December 31, 2011 as follows: • A stock dividend of P4,000 shares from Part Company on July 31, 2011 when the market price of Part's share was P20. Care owns less than 1% of Part's share capital. • A cash dividend of P150,000 from Shark Company in which Day owns a 25% interest. Majority of Shark's director are also directors of Care. What amount of…arrow_forward
- SW Company provides the Equity & Liability information below for analysis. SW Company had net income of $365, 700 in 2023 and $335,800 in 2022. Equity and Liabilities 2023 2022 Share capital-common (137,700 shares issued) $ 1,417,500 $ 1,417,500 Retained earnings (Note 1) 417,700 311, 300 Accrued liabilities 10,300 6,500 Notes payable (current) 82,700 65,500 Accounts payable 59,500 179,000 Total equity and liabilities $1,987,700 $ 1,979,800 Note 1: Cash dividends were paid at the rate of $1 per share in 2022 and $2 per share in 2023. Required: 1. Calculate the return on common share equity for 2022 and 2023. (Assume total equity was $1,454,000 at December 31, 2021.) (Round your answers to 1 decimal place.) 2. Calculate the book value per shares for 2022 and 2023. (Round your answers to 2 decimal places.)arrow_forwardProblem 18-5 (Static) Shareholders' equity transactions; statement of shareholders' equity [LO18-6,18- 7,18-8] Listed below are the transactions that affected the shareholders' equity of Branch-Rickle Corporation during the period 2021=2023. At December 31, 2020, the corporation's accounts included: 57:28 Common stock, 105 million shares at $1 par Paid-in capital-excess of par Retained earnings sin thousands) $105,000 630,000 970,000 at nces a. November 1, 2021, the board of directors declared a cash dividend of $0.80 per share on its common shares, payable to shareholders of record November 15, to be paid December b On March 1, 2022, the board of directors declared a property dividend consisting of corporate bonds of Warner Corporation that Branch Rickie was holding as an investment. The bonds had a fair value of $1.6 million, but were purchased two years previously for $1.3 million. Because they were intended to be held to maturity, the bonds had not been previously written up. The…arrow_forwardProblem 1 (Adapted)The shareholders’ equity of Yelan Company showed the following account balances on December 31, 2018:Share capital, P100 5,000,000Share Premium 1,000,000Retained earnings 2,000,000Revaluation surplus 800,000 Compute the book value per share on December 31, 2018.arrow_forward
- Problem 18-5 (Algo) Shareholders' equity transactions; statement of shareholders' equity; financial statement effects [LO18-6, 18-7, 18-8] Listed below are the transactions that affected the shareholders' equity of Branch-Rickie Corporation during the period 2024-2026. At December 31, 2023, the corporation's accounts included: Common stock, 112 million shares at $1 par Paid-in capital-excess of par Retained earnings ($ in thousands) $ 112,000 672,000 910,000 a. November 1, 2024, the board of directors declared a cash dividend of $0.70 per share on its common shares, payable to shareholders of record November 15, to be paid December 1. b. On March 1, 2025, the board of directors declared a property dividend consisting of corporate bonds of Warner Corporation that Branch-Rickie was holding as an investment. The bonds had a fair value of $2.8 million, but were purchased two years previously for $2.4 million. Because they were intended to be held to maturity, the bonds had not been…arrow_forwardProblem 1 Listed below are the transactions that affected the shareholders' equity of Branch-Rickie Corporation during the period 2023 to 2025. At December 31, 2022, the corporation's accounts included (in thousands): Ordinary share capital, P1 par Share premium 105,000 630,000 Retained earnings 970,000 a. On November 1, 2023, the board of directors declared a cash dividend of PO 80 per share on its ordinary shares, payable to shareholders of record on November 15, to be paid on December 1. b. On March 1, 2024, the board of directors declared a property dividend consisting of corporate bonds of Warner Corporation that Branch-Ricki was holding as an investment. The bonds had a fair value of P1.6 million, but were purchased two years previously for P1.3 million. Because they were intended to be held to maturity, the bonds had not been previously written up. The property dividend was payable to shareholders of record on March 13, to be distributed on April 5. The fair value of the…arrow_forwardPROBLEM 28 (AICPA Adapted)Miraflores owned 10,000 shares in Maquiling Company acquired several years ago at P100 per share to be held as a long-term investment. Beginning in 2015, Miraflores received a dividend of P40 pershare. Maquiling Company notifies the investor that a portion of this amount represented earnings and the balance as liquidating dividends. The allocation to be made as follows: Earned Dividend Liquidating Dividend2015 - P402016 P10 P302017 P15 P252018 P20 P202019 P25 P15 Requirements:1. Prepare journal entries on the books of…arrow_forward
- View Policies Current Attempt in Progress Outstanding stock of the Vaughn Corporation included 19900 shares of $5 par common stock and 9950 shares of 7%, $10 par noncumulative preferred stock. In 2020, Vaughn declared and paid dividends of $4000. In 2021, Vaughn declared and paid dividends of $12500. How much of the 2021 dividend was distributed to preferred shareholders? O $8500 O $4000 O $6965 O None of these answers are correct Save for Later Attempts: 0 of 1 used Submit Answerarrow_forwardThe following data pertains to Kyne Co.’s investments in marketable equity securities: Market value Cost 12/31/22 12/31/23XYZ Stock 150,000 $155,000 $100,000ABC Stock $150,000 130,000 120,000 What amount should Kyne include as unrealized holding loss in its 2023 Net Income?a) $50,000b) $55,000c) $60,000d) $65,000e) $5,000arrow_forward4. How much is the gain (loss) on the sale of Mad Company ordinary shares on July 18, 2023? A. P4,500B. P3,000C. P1,500D. P0 5. What is the amount transferred to retained earnings if Jam Company opted to transfer the unrealized gain or loss relating to the shares sold? A. P11,100B. P5,500C. P5,100D. P1,500arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,
Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSON
Intermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill Education
Financial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education