Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On January 1, Year 11, Rohan Corporation purchased 15,000 common shares of Singh Lid for $8.50 per share plus $2,500 in commission Singh Ltd had

image text in transcribed
On January 1, Year 11, Rohan Corporation purchased 15,000 common shares of Singh Lid for $8.50 per share plus $2,500 in commission Singh Ltd had 100,000 common shares outstanding. During Year 11, Singh earned net income of $80,000. On December 31, Year 11, Singh declared dividends of $20,000. The investment in Singh Ltd shares were trading at $9.30 per share at December 31, Year 11. On February 1, Year 12, Singh paid the dividends. During Year 12, Singh incurred a net loss of $40,000. At December 31, Year 12, investment in Singh Ltd shares was trading at $8.90 per share. January 15, Year 13, Rohan sold its investment in Singh Ltd for $9.20 per share less $500 in commission Rohan elected to account for its passive investments in shares under Fair Value thru OCI method and record dividends income separately. Rohan year end is December 31. Required: i) Prepare all journal entries for Year 11 and Year 12 (8 marks) ii) Prepare the joumal entry(ies) to record the sale on January 15, Year 13 and any closing entry relating to the sale (5 marks). 6000 On January 1, Year 11, Rohan Corporation purchased 15,000 common shares of Singh Lid for $8.50 per share plus $2,500 in commission Singh Ltd had 100,000 common shares outstanding. During Year 11, Singh earned net income of $80,000. On December 31, Year 11, Singh declared dividends of $20,000. The investment in Singh Ltd shares were trading at $9.30 per share at December 31, Year 11. On February 1, Year 12, Singh paid the dividends. During Year 12, Singh incurred a net loss of $40,000. At December 31, Year 12, investment in Singh Ltd shares was trading at $8.90 per share. January 15, Year 13, Rohan sold its investment in Singh Ltd for $9.20 per share less $500 in commission Rohan elected to account for its passive investments in shares under Fair Value thru OCI method and record dividends income separately. Rohan year end is December 31. Required: i) Prepare all journal entries for Year 11 and Year 12 (8 marks) ii) Prepare the joumal entry(ies) to record the sale on January 15, Year 13 and any closing entry relating to the sale (5 marks). 6000

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

Step: 3

blur-text-image

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

CIA Part 1 Essentials Of Internal Auditing Certified Internal Auditor 2019

Authors: Muhammad Zain

1st Edition

1091949182, 978-1091949188

More Books

Students also viewed these Accounting questions

Question

What information is necessary for random stocking to work?

Answered: 1 week ago

Question

List the components of the strategic management process. page 72

Answered: 1 week ago