Answered step by step
Verified Expert Solution
Question
1 Approved Answer
2015 Jan. 7 Purchased as a temporary investment 400 shares of Chromax Co. stock at $14, plus brokerage fees of $160. May 18 Sold the
2015 Jan. 7 Purchased as a temporary investment 400 shares of Chromax Co. stock at $14, plus brokerage fees of $160. May 18 Sold the investment in Chromax Co. stock for $19 a share, less brokerage fees of $180. 24 Issued 2,000 shares of United's $5 par common stock for cash of $30 a share. June 6 Declared a 1% stock dividend on the 210,000 shares of United's $5 par value common stock issued and outstanding to stockholders of record on June 15, distributable on July 1. The market price of the stock on June 6 is $33 a share. July 1 Issued the common shares involved with the stock dividend. 1 Issued $100,000, 5-year, 8% bonds, dated July 1, 2015, receiving cash of $92,278. Interest is payable semiannually on July 1 and January 1. Aug. 5 Reacquired 1,000 shares of United's common stock for $36,110. Sept. 21 Sold all the shares of treasury stock purchased above for $39,820. Oct. Purchased 10, 8%, $1,000 Uno Corp. 10-year bonds for $10,200 plus brokerage fees of 00. Interest is receivable semiannually on April 1 and October 1. Dec. 5 Declared a semiannual cash dividend of $.60 per share on common stock to be paid on January 2, 2016. Share data: 1,000,000 shares authorized, 212,100 shares issued and outstanding. Selected Adjustments: 2015 Dec. 31 Record appropriate amortization of the bonds issued on July 1, 2015, of $614. 31 Record accrued interest owed on the same bonds. 31 Record accrued interest earned on the 8% Uno Corp. bonds purchased on October 1. 31 Prepare the adjusting entry for income taxes based on the following data and the fact that the two dissimilar amounts reported as income below were the result of temporary differences: Income tax rate ............. 40% Income before income tax per financial statements ............. $920,000 Taxable income per income tax return......... 850,000 2015 Jan. 7 Purchased as a temporary investment 400 shares of Chromax Co. stock at $14, plus brokerage fees of $160. May 18 Sold the investment in Chromax Co. stock for $19 a share, less brokerage fees of $180. 24 Issued 2,000 shares of United's $5 par common stock for cash of $30 a share. June 6 Declared a 1% stock dividend on the 210,000 shares of United's $5 par value common stock issued and outstanding to stockholders of record on June 15, distributable on July 1. The market price of the stock on June 6 is $33 a share. July 1 Issued the common shares involved with the stock dividend. 1 Issued $100,000, 5-year, 8% bonds, dated July 1, 2015, receiving cash of $92,278. Interest is payable semiannually on July 1 and January 1. Aug. 5 Reacquired 1,000 shares of United's common stock for $36,110. Sept. 21 Sold all the shares of treasury stock purchased above for $39,820. Oct. Purchased 10, 8%, $1,000 Uno Corp. 10-year bonds for $10,200 plus brokerage fees of 00. Interest is receivable semiannually on April 1 and October 1. Dec. 5 Declared a semiannual cash dividend of $.60 per share on common stock to be paid on January 2, 2016. Share data: 1,000,000 shares authorized, 212,100 shares issued and outstanding. Selected Adjustments: 2015 Dec. 31 Record appropriate amortization of the bonds issued on July 1, 2015, of $614. 31 Record accrued interest owed on the same bonds. 31 Record accrued interest earned on the 8% Uno Corp. bonds purchased on October 1. 31 Prepare the adjusting entry for income taxes based on the following data and the fact that the two dissimilar amounts reported as income below were the result of temporary differences: Income tax rate ............. 40% Income before income tax per financial statements ............. $920,000 Taxable income per income tax return......... 850,000
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started