Zeus Investments Inc. is a regional investment company that began operations on January 1, 2014. The following
Question:
Zeus Investments Inc. is a regional investment company that began operations on January 1, 2014. The following transactions relate to trading securities acquired by Zeus Investments Inc., which has a fiscal year ending on December 31:
2014
Feb. 14. Purchased 4,800 shares of Apollo Inc. as a trading security at $26 per share plus a brokerage commission of $192.
Apr. 1. Purchased 2,300 shares of Ares Inc. as a trading security at $19 per share plus a brokerage commission of $92.
June 1. Sold 600 shares of Apollo Inc. for $32 per share less a $100 brokerage commission.
27. Received an annual dividend of $0.20 per share on Apollo Inc. stock.
Dec. 31. The portfolio of trading securities was adjusted to fair values of $33 and $18.50 per share for Apollo Inc. and Ares Inc., respectively.
2015
Mar. 14. Purchased 1,200 shares of Athena Inc. as a trading security at $65 per share plus a $120 brokerage commission.
June 26. Received an annual dividend of $0.21 per share on Apollo Inc. stock.
July 30. Sold 480 shares of Athena Inc. for $60 per share less a $50 brokerage commission.
Dec. 31. The portfolio of trading securities had a cost of $200,032 and a fair value of $188,000, requiring a credit balance in Valuation Allowance for Trading Investments of $12,032 ($200,032 2 $188,000). Thus, the debit balance from
December 31, 2014, is to be adjusted to the new balance.
Instructions
1. Journalize the entries to record these transactions.
2. Prepare the investment-related current asset balance sheet presentation for Zeus
Investments Inc. on December 31, 2015.
3. How are unrealized gains or losses on trading investments presented in the financial statements of Zeus Investments Inc.?
Financial StatementsFinancial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... 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... 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... Portfolio
A portfolio is a grouping of financial assets such as stocks, bonds, commodities, currencies and cash equivalents, as well as their fund counterparts, including mutual, exchange-traded and closed funds. A portfolio can also consist of non-publicly...
Step by Step Answer:
1 2014 Feb14 Investments Apollo Inc 124992 Cash 124992 April1 Investments Ares Inc 43792 Cash 43792 ...View the full answer
Corporate Financial Accounting
ISBN: 978-1133952411
12th edition
Authors: Carl S. Warren, James M. Reeve, Jonathan E. Duchac
