Determine the missing letters in the umclassified balance shee supporting caleulatic and Fair Vaue Accounting hensive Problem 4 Selected transactions completed by Equinos Products Inc. during the December 31, Year 1, were as follows a. Issued 15,000 shares of $20 par comrnon saock at %30, b. Issued 4,000 shares of $80 par preferred 9% sixk at $100, re issued $500,000 of 0-year, 5% bonds at io4, with interest , d. Declared a quarterly dividend of $0.50 per share on common sto preferred stock. On the date of record, 100,000 shares treasury shares were held and 20,000 shares of pr k and $1.00 per share on of common stock were outstanding, eferred tock were outstanding e. Paid the cash dividends declared in (d) f. Purchased 7.500 shares of Solstice Corp, at $40 per share plus a $150 mission. The investment is classified as an available-for-sale investme g. Purchased 8,000 shares of treasury common stock at $33 per share. h. Purchased 40,000 shares of Pinkberry Co. stock directly from the founders for $24 per Products Inc share. Pinkberry has 125,000 shares issued and outstanding. Equinox treated the investment as an equity method investment. i. Declared a $1.00 quarterly cash dividend per share on preferred stoc of record, 20,000 shares of preferred stock had been iss j. Paid the cash dividends to the preferred stockholders. k. Received $27,500 dividend from Pinkberry Co. investment in Ch) l. 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 he to-maturity long-term investment. m. Sold, at $38 per share, 2,600 shares of treasury common stock purchased n. Received a dividend of $0.60 per share from the Solstice Corp o. Sold 1,000 shares of Solstice Corp. at $45, including commission p. Record in (g) investment in ( ded 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 q. Accrued interest for three months on the Dream Inc. bonds purchased in ) r. Pinkberry Co. recorded total earnings of $240,000. Equinox Products recorded equity 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 earnings for its share of Pinkberry Co. net income. s. Instructions Journalize the selected transactions. After all of the transactions for the year ended December 31, Year 1, had been posted lincluding the transactions recorded in part (1) and all adjusting entries), the data that follows were taken from the records of Equinox Products Inc a. Prepare a multiple-step income statement for the year ended December 31, Year 1, . concluding with earnings per share. In computing earnings per share, assume that the average number of common shares outstanding was 100,000 and preferred dividends were $100,000. Round earnings per share to the nearest cent. b. Prepare a retained earnings statement for the year ended December 31, Year 1 Continued) Rrenare a balance sheet in report form as of December 31, Year 1
