Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

4. a) On September 1, 2022, XYZ company purchased common stock from 3 companies - all representing less than 20% of the voting stock outstanding

image text in transcribed

4. a) On September 1, 2022, XYZ company purchased common stock from 3 companies - all representing less than 20% of the voting stock outstanding Maddow Inc. Smith Inc. Rudolph Inc. Cost $55,000 $120,000 $78,000 $253,000 Prepare a journal entry to record the purchase of the equity Trading securities. b) On December 30, 2022, a cash dividend of $2,000 was received. Prepare the journal entry to record this transaction. c) At December 31, 2022, XYZ company's stock portfolio had the following values Maddow Inc. Smith Inc. Rudolph Inc. Cost $55,000 $120,000 $78,000 $253,000 Fair Value $68,600 $128,200 $65,500 $262,300 Prepare the journal entry to adjust XYZ company's stock investments to fair value. d) On March 20, 2023, all shares of the Smith Inc. stock was sold for $127,500. Prepare the necessary journal entry. e) At December 31, 2023, assume the following fair values of the remaining stocks. Maddow Inc. Rudolph Inc. Cost $55,000 $78,000 $133,000 Fair Value $40,200 $69,500 $109,700 Assume the Adjustment account has a beginning Debit balance of $9,300. Prepare a journal entry to adjust the equity security Trading investments to fair value

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting And Causal Effects Econometric Challenges

Authors: Douglas A Schroeder

1st Edition

1441972242, 9781441972248

More Books

Students also viewed these Accounting questions

Question

Describe three types of learning discussed in the work of Koffka.

Answered: 1 week ago