Suppose Carlton Ltd. completed the following investment transactions in 2017 and 2018: 2017 Nov. 6 Purchased 2,000
Question:
2017
Nov. 6 Purchased 2,000 McGill Corporation common shares for $60,000. Carlton plans to sell the shares in the near future to meet its operating cash flow requirements. Commissions on the purchase were $800.
30 Received a quarterly cash dividend of $1.50 per share on the McGill Corporation shares.
Dec. 31 Current fair value of the McGill common shares is $62,000.
2018
Jan. 20 Sold the McGill Corporation shares for $63,000, less commissions on the sale of $900.
Required
1. Make the entries to record Carlton Ltd.'s investment transactions. Explanations are not required. Carlton Ltd.'s year end is December 31.
2. Show how Carlton Ltd. would report its investment in the McGill Corporation shares on the balance sheet at December 31, 2017.
Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...
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