As financial reporting advisors, we are asked by the head of Sterling Co. to advise in accounting for stock investments. This is the first year Sterling had extra cash to invest in stock investments, and it purchased 1,000 shares of LDX for $23 on January 1 of this year. The Tableau Dashboard is provided to aid us in our analysis. Fair Value of Stock Investments Portfolio Dividend Dividend $30,000 $27,500 $25,000 Fair Value $22,500 $20,000 $17,500 $15,000 January 1 December 31 1. Prepare Sterling's journal entry to record the receipt of dividends on LDX stock on May 10 and November 12. 2. Prepare Sterling's December 31 year-end adjusting entry to report its stock investments with insignificant influence at fair value. 3. Sterling sells a portion of its LDX stock (for $550 cash that had cost $400) on January 3 of next year. Prepare the entry for the sale of those stock investments. Required 1 Required 2 Required 3 Prepare Sterling's journal entry to record the receipt of dividends on LDX stock on May 10 and November 12. No Date General Journal Debit Credit 1 May 10 Cash Dividend revenue 2 Nov 12 Cash Dividend revenue Required 1 Required 2 > Required 1 Required 2 Required 3 Prepare Sterling's December 31 year-end adjusting entry to report its stock investments with insignificant influence at fair value. No Date General Journal Debit Credit 1 Dec 31 Fair value adjustment - Stock Unrealized gain - Income Required 1 Required 2 Required 3 Sterling sells a portion of its LDX stock (for $550 cash that had cost $400) on January 3 of next year. Prepare the entry for the sale of those stock investments. No Date General Journal Debit Credit 1 Jan 03 No Transaction Recorded As financial reporting advisors, we are asked by the head of Sterling Co. to advise in accounting for stock investments. This is the first year Sterling had extra cash to invest in stock investments, and it purchased 1,000 shares of LDX for $23 on January 1 of this year. The Tableau Dashboard is provided to aid us in our analysis. Fair Value of Stock Investments Portfolio Dividend Dividend $30,000 $27,500 $25,000 Fair Value $22,500 $20,000 $17,500 $15,000 January 1 December 31 1. Prepare Sterling's journal entry to record the receipt of dividends on LDX stock on May 10 and November 12. 2. Prepare Sterling's December 31 year-end adjusting entry to report its stock investments with insignificant influence at fair value. 3. Sterling sells a portion of its LDX stock (for $550 cash that had cost $400) on January 3 of next year. Prepare the entry for the sale of those stock investments. Required 1 Required 2 Required 3 Prepare Sterling's journal entry to record the receipt of dividends on LDX stock on May 10 and November 12. No Date General Journal Debit Credit 1 May 10 Cash Dividend revenue 2 Nov 12 Cash Dividend revenue Required 1 Required 2 > Required 1 Required 2 Required 3 Prepare Sterling's December 31 year-end adjusting entry to report its stock investments with insignificant influence at fair value. No Date General Journal Debit Credit 1 Dec 31 Fair value adjustment - Stock Unrealized gain - Income Required 1 Required 2 Required 3 Sterling sells a portion of its LDX stock (for $550 cash that had cost $400) on January 3 of next year. Prepare the entry for the sale of those stock investments. No Date General Journal Debit Credit 1 Jan 03 No Transaction Recorded
