On December 31,2021, the end of its first year of operations, Wildhorse Associates owned the following securities that are held as long-term investments.
On December 31, 2021. the end of its first year of operations, Wildhorse Associates owned the following securities that are held as long-term investments Common Stock Shares Cost C Co. 1.050 $50,400 D CO. 5.090 38,175 E Co. 1.199 25.179 On this date, the total fair value of the securities was equal to its cost. The securities are not held for influence or control over the investees. In 2022, the following transactions occurred. July 1 Received $2.00 per share semiannual cash dividend on D Co.common stock Aug 1 Received 50.50 per share cash dividend on C Co.common stock. Sept 1 Sold 1.020 shares of Co. common stock for cash at $8 per share. On this date, the total fair value of the securities was equal to its cost. The securities are not held for influence or control over the Investees. In 2022, the following transactions occurred. July 1 Aug 1 Sept 1 Oct. 1 Received $2.00 per share semiannual cash dividend on D Co.common stock. Received $0.50 per share cash dividend on Co.common stock Sold 1,020 shares of Co.common stock for cash at $8 per share. Sold 310 shares of C Co.common stock for cash at $52 per share. Received $1 per share cash dividend on E Co. common stock Received $0.50 per share cash dividend on C Co. common stock Received $2.00 per share semiannual cash dividend on D Co.common stock Nov. 1 Dec. 15 31 At December 31, the fair values per share of the common stocks were C Co $47, D Co. 57.30, and E Co. $25. These investments should be classified as long-term (a) Your answer is correct Journalize the 2022 transactions, (Record journal entries in the order presented in the problem. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter for the amounts.) Date Account Titles and Explanation Debit Credit July 1 Cash 10130 Dividend Revenue 10160 Aug 1 Cash 525 Aug 1 Cash 525 Dividend Revenue 525 Sept 1 Cash 8160 Stock Investments 7850 Gain on Sale of Stock Investments 510 Oct 1 Cash 16 120 Stock Investments 14890 Gain on Sale of Stock Investments 1240 Nov. 1 V 1199 Dividend Revenue 1199 Dec 15 Cach 370 Dividend Revenu 770 Dec 31 8140 Dividend Revenue 140 Post to the account Stock Investments. Stock Investments Jan. 1 Balance 113754 Sept. 1 7650 Oct. 1 14880 Dec. 31 Balance 91224 (b) Prepare the adjusting entry at December 31, 2022 to show the securities at fair value. Wildhorse has less than a 20% ownership interest in all these common stocks (CCO, D Co., and E Co.). (Credit account titles are automatically indented when the amount is entered. Do not Indent manually. If no entry is required, select "No Entry" for the account titles and enter for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31
