Question
Riverbed, Inc. had the following equity investment portfolio at January 1, 2020. Evers Company 960 shares @ $16 each $15,360 Rogers Company 910 shares @
Riverbed, Inc. had the following equity investment portfolio at January 1, 2020.
Evers Company 960 shares @ $16 each $15,360
Rogers Company 910 shares @ $22 each 20,020
Chance Company 500 shares @ $9 each 4,500
Equity investments @ cost 39,880
Fair value adjustment (7,870 )
Equity investments @ fair value $32,010
During 2020, the following transactions took place.
1. On March 1, Rogers Company paid a $2 per share dividend.
2. On April 30, Riverbed, Inc. sold 310 shares of Chance Company for $11 per share.
3. On May 15, Riverbed, Inc. purchased 110 more shares of Evers Company stock at $17 per share.
4. At December 31, 2020, the stocks had the following price per share values: Evers $18, Rogers $21, and Chance $8.
During 2021, the following transactions took place.
5. On February 1, Riverbed, Inc. sold the remaining Chance shares for $8 per share.
6. On March 1, Rogers Company paid a $2 per share dividend.
7. On December 21, Evers Company declared a cash dividend of $3 per share to be paid in the next month.
8. At December 31, 2021, the stocks had the following price per share values: Evers $20 and Rogers $23.
Collapse question part
(a)
Correct answer. Your answer is correct.
Prepare journal entries for each of the above transactions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
No.
Account Titles and Explanation
Debit
Credit
(1)
Entry field with correct answer
Cash
Entry field with correct answer
1820
Entry field with correct answer
Entry field with correct answer
Dividend Revenue
Entry field with correct answer
Entry field with correct answer
1820
(2)
Entry field with correct answer
Cash
Entry field with correct answer
3410
Entry field with correct answer
Entry field with correct answer
Gain on Sale of Investments
Entry field with correct answer
Entry field with correct answer
620
Entry field with correct answer
Equity Investments
Entry field with correct answer
Entry field with correct answer
2790
(3)
Entry field with correct answer
Equity Investments
Entry field with correct answer
1870
Entry field with correct answer
Entry field with correct answer
Cash
Entry field with correct answer
Entry field with correct answer
1870
(4)
Entry field with correct answer
Fair Value Adjustment
Entry field with correct answer
8800
Entry field with correct answer
Entry field with correct answer
Unrealized Holding Gain or Loss - Income
Entry field with correct answer
Entry field with correct answer
8800
(5)
Entry field with correct answer
Cash
Entry field with correct answer
1520
Entry field with correct answer
Entry field with correct answer
Loss on Sale of Investments
Entry field with correct answer
190
Entry field with correct answer
Entry field with correct answer
Equity Investments
Entry field with correct answer
Entry field with correct answer
1710
(6)
Entry field with correct answer
Cash
Entry field with correct answer
1820
Entry field with correct answer
Entry field with correct answer
Dividend Revenue
Entry field with correct answer
Entry field with correct answer
1820
(7)
Entry field with correct answer
Dividend Receivable
Entry field with correct answer
3210
Entry field with correct answer
Entry field with correct answer
Dividend Revenue
Entry field with correct answer
Entry field with correct answer
3210
(8)
Entry field with correct answer
Fair Value Adjustment
Entry field with correct answer
4,150
Entry field with correct answer
Entry field with correct answer
Unrealized Holding Gain or Loss - Income
Entry field with correct answer
Entry field with correct answer
4,150
SHOW LIST OF ACCOUNTS
SHOW SOLUTION
LINK TO TEXT
Attempts: 4 of 5 used
Collapse question part
(b)
a partial balance sheet showing the investment-related amounts to be reported at December 31, 2020 and 2021.
Riverbed, Inc.
Balance Sheet (Partial)
December 31, 2020
December 31, 2021
$
$
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Income Tax Fundamentals 2013
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
31st Edition
1111972516, 978-1285586618, 1285586611, 978-1285613109, 978-1111972516
