Exercise 15-6 Non-strategic Investments LO3 $4,200 CHECK FIGURE: 2. Jan. 14, 2018, Investment loss George's Mortgage Inc. engaged in the following non-strategic investment transactions during 2017 2017 Purchased for $406,844 a 6 % , $400,000 Janvis Corp. bond that matures in five years when the market interest rate was 5.6 %. Interest is paid semiannually beginning June 30, 2017. George's Inc. plans to hold this investment until maturity Jan. 1 Bought 6,000 shares of Medley Corp., paying $32.50 per share. Received dividends of $0.40 per share on the Mediey Corp. shares. Paid $316,000 for 21,000 shares of Zhang common shares Mar. 1 7 May 1. June 30 Received interest on the Janvis bond, June Sold the Mediey Corp. shares for $32.75 per share. Aug. 31 1 Received interest on the Jarvis bond. Dec. The fair value of the Zhang shares on this date was $14.80 per share. Assume the fair value of the bonds equaled the carying value. Dec. 31 2018 Sold the Zhang shares for $14.60. Jan. 14 Required 1. Prepare an amortization schedule for the Jarvis bond showing only 2017 and 2018 2. Prepare the entries to record the transactions described above. 3. Show how the investments would be reported on George's December 31, 2017, balance sheet. Exercise 15-7 Share investment transactions; equity method L04 CHECK FIGURE: Dec. 31, 2018: Loss $8,360 The following events are for Toronto Investment Inc.: 2017 Jan 14 Purchased 18,000 shares of Queen's Inc. common shares for $156,400. Queen's has 90,000 common shares outstanding and has acknowledged the fact that its policies wil be significantly influenced by Toronto. Oct Queen's declared and paid a cash dividend of $2.60 per share. Dec. 3: Queen's announced that profit for the year amounted to $650,000. 2018 April Queen's declared and paid a cash dividend of $2.70 per share. Queen's announced that profit for the uear amounted to $733,100. 31 1 Dec. 31 Toronto sold 6,000 shares of Queen's for $104,320. Required Prepare general journal entries to record each transaction. Round per share calculations to two decimal places Exercise 15-6 Non-strateaic investments LO3 CHECK FIGURE: 2, Jan, 14, 2018, Investment loss = $4,200 George's Mortgage Inc. engaged in the following non-strategic investment transactions during 2017 Purchased for $406,894 a 6 % , $ 400,000 Jarvis Corp. bond that matures in tve years when the market interest rate was 5.6 %, Interest is paid semiannually beginning June 30,, 2017. Geomge's Inc. pians to hola this investment until maturity 2017 Jen. 1 Bought 6,000 shares of Medley Corp., paying $32.50 per share. Received dividends of $0,90 per share on the Mediey Corp. shares. Paid $316,000 for 21.000 shares of Zhang common shares. Received interest on the Jarvis bond. Mar 1 May June 7 1 June 30 Soid the Medley Corp, shares for $32.75 per share. Received interest on the Jarvis bond. Aug. The fair value of the Zhang shares on this date was $14.80 per share. Assume the fair value of the bonds equalled the carrying value. Dec. 31 Dec. 31 2018 Jan 14 Sold the Zhang shares for $14.60. Required 1. Prepare an amortization schedule for the Jarvis bond showing only 2017 and 2018. 2. Prepare the entries to record the transactions described above 3. Show how the investments would be reported on George's December 31, 2017, balance sheet. CHAPTER 15 Accounting for Debt and Share investroants Exercise 15-7 Share investment transactions; equity method LO4 CHECK FIGURE: Dec. 31, 2018: Loss $8,360 The following events are for Toronto Investment Inc.: 2017 Purchased 18,000 shares of Queen's Inc. common shares for $156.900 Queen's has 90,000 common shares outstanding and has acknowledged the fact that its policies will be significantiy influenced by Toronto. Oueen's declared and paid a cash dividend of $2.60 per share. 14 Jan. Oct. Oueen's announced that profit for the uear amounted to $650.000, 31 Dec. 2018 Oueen's declared and paid a cash dividend of $2.70 per share. 1 April Oueen's announced that profit for the uear amounted to $733.100. Toronto sold 6,000 shares of Queen's for $104.320. 31 Dec. 31 Required Prepare general journal entries to record each transaction. Round per share calculations to two decimal places. Problems Exercise 15-6 Non-strategic Investments LO3 $4,200 CHECK FIGURE: 2. Jan. 14, 2018, Investment loss George's Mortgage Inc. engaged in the following non-strategic investment transactions during 2017 2017 Purchased for $406,844 a 6 % , $400,000 Janvis Corp. bond that matures in five years when the market interest rate was 5.6 %. Interest is paid semiannually beginning June 30, 2017. George's Inc. plans to hold this investment until maturity Jan. 1 Bought 6,000 shares of Medley Corp., paying $32.50 per share. Received dividends of $0.40 per share on the Mediey Corp. shares. Paid $316,000 for 21,000 shares of Zhang common shares Mar. 1 7 May 1. June 30 Received interest on the Janvis bond, June Sold the Mediey Corp. shares for $32.75 per share. Aug. 31 1 Received interest on the Jarvis bond. Dec. The fair value of the Zhang shares on this date was $14.80 per share. Assume the fair value of the bonds equaled the carying value. Dec. 31 2018 Sold the Zhang shares for $14.60. Jan. 14 Required 1. Prepare an amortization schedule for the Jarvis bond showing only 2017 and 2018 2. Prepare the entries to record the transactions described above. 3. Show how the investments would be reported on George's December 31, 2017, balance sheet. Exercise 15-7 Share investment transactions; equity method L04 CHECK FIGURE: Dec. 31, 2018: Loss $8,360 The following events are for Toronto Investment Inc.: 2017 Jan 14 Purchased 18,000 shares of Queen's Inc. common shares for $156,400. Queen's has 90,000 common shares outstanding and has acknowledged the fact that its policies wil be significantly influenced by Toronto. Oct Queen's declared and paid a cash dividend of $2.60 per share. Dec. 3: Queen's announced that profit for the year amounted to $650,000. 2018 April Queen's declared and paid a cash dividend of $2.70 per share. Queen's announced that profit for the uear amounted to $733,100. 31 1 Dec. 31 Toronto sold 6,000 shares of Queen's for $104,320. Required Prepare general journal entries to record each transaction. Round per share calculations to two decimal places Exercise 15-6 Non-strateaic investments LO3 CHECK FIGURE: 2, Jan, 14, 2018, Investment loss = $4,200 George's Mortgage Inc. engaged in the following non-strategic investment transactions during 2017 Purchased for $406,894 a 6 % , $ 400,000 Jarvis Corp. bond that matures in tve years when the market interest rate was 5.6 %, Interest is paid semiannually beginning June 30,, 2017. Geomge's Inc. pians to hola this investment until maturity 2017 Jen. 1 Bought 6,000 shares of Medley Corp., paying $32.50 per share. Received dividends of $0,90 per share on the Mediey Corp. shares. Paid $316,000 for 21.000 shares of Zhang common shares. Received interest on the Jarvis bond. Mar 1 May June 7 1 June 30 Soid the Medley Corp, shares for $32.75 per share. Received interest on the Jarvis bond. Aug. The fair value of the Zhang shares on this date was $14.80 per share. Assume the fair value of the bonds equalled the carrying value. Dec. 31 Dec. 31 2018 Jan 14 Sold the Zhang shares for $14.60. Required 1. Prepare an amortization schedule for the Jarvis bond showing only 2017 and 2018. 2. Prepare the entries to record the transactions described above 3. Show how the investments would be reported on George's December 31, 2017, balance sheet. CHAPTER 15 Accounting for Debt and Share investroants Exercise 15-7 Share investment transactions; equity method LO4 CHECK FIGURE: Dec. 31, 2018: Loss $8,360 The following events are for Toronto Investment Inc.: 2017 Purchased 18,000 shares of Queen's Inc. common shares for $156.900 Queen's has 90,000 common shares outstanding and has acknowledged the fact that its policies will be significantiy influenced by Toronto. Oueen's declared and paid a cash dividend of $2.60 per share. 14 Jan. Oct. Oueen's announced that profit for the uear amounted to $650.000, 31 Dec. 2018 Oueen's declared and paid a cash dividend of $2.70 per share. 1 April Oueen's announced that profit for the uear amounted to $733.100. Toronto sold 6,000 shares of Queen's for $104.320. 31 Dec. 31 Required Prepare general journal entries to record each transaction. Round per share calculations to two decimal places. Problems