Gator Shoes, Incorporated, manufactures a line of stylish waterproof footwear. The following transactions relate to investments in common stock during 2024. March 1 July 1 Purchases 2,700 shares (10%) of Power Drive Corporation's common stock for $59 per share. Receives a cash dividend of $1.40 per share. December 31 The fair value of Power Drive Corporation's common stock is $72 per share. On February 1, 2025 (the following year), Gator Shoes sells 675 shares of Power Drive Corporation's common stock for $67 per share. Required: 1. Record each of these transactions in 2024, including an adjusting entry on December 31 for the investment's fair value, if appropriate. 2. Record the sale on February 1, 2025. Note: If no entry is require

Gator Shoes, Incorporated, manufactures a line of stylish waterproof footwear. The following transactions relate to investments in common stock during 2024. March 1 July 1 Purchases 2,700 shares (10%) of Power Drive Corporation's common stock for $59 per share. Receives a cash dividend of $1.40 per share. December 31 The fair value of Power Drive Corporation's common stock is $72 per share. On February 1, 2025 (the following year), Gator Shoes sells 675 shares of Power Drive Corporation's common stock for $67 per share. Required: 1. Record each of these transactions in 2024, including an adjusting entry on December 31 for the investment's fair value, if appropriate. 2. Record the sale on February 1, 2025. Note: If no entry is require

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter16: Retained Earnings And Earnings Per Share

Section: Chapter Questions

Problem 3P: On January 1, 2019, Kittson Company had a retained earnings balance of 218,600. It is subject to a...

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On January 1, 2019, Kittson Company had a retained earnings balance of 218,600. It is subject to a 30% corporate income tax rate. During 2019, Kittson earned net income of 67,000, and the following events occurred: 1. Cash dividends of 3 per share on 4,000 shares of common stock were declared and paid. 2. A small stock dividend was declared and issued. The dividend consisted of 600 shares of 10 par common stock. On the date of declaration, the market price of the companys common stock was 36 per share. 3. The company recalled and retired 500 shares of 100 par preferred stock. The call price was 125 per share; the stock had originally been issued for 110 per share. 4. The company discovered that it had erroneously recorded depreciation expense of 45,000 in 2018 for both financial reporting and income tax reporting. The correct depreciation for 2018 should have been 20,000. This is considered a material error. Required: 1. Prepare journal entries to record Items 1 through 4. 2. Prepare Kittsons statement of retained earnings for the year ended December 31, 2019.
Hyde Corporations capital structure at December 31, 2018, was as follows: On July 2, 2019, Hyde issued a 10% stock dividend on its common stock and paid a cash dividend of 2.00 per share on its preferred stock. Net income for the year ended December 31, 2019, was 780,000. What should be Hydes 2019 basic earnings per share? a. 7.80 b. 7.09 c. 7.68 d. 6.73
Iron King Corporation had the following transactions during 2019: Jan. 1. Issued 6,000 ordinary shares at par of P100 in exchange for real property with a market value of P800,000. The corporation is authorized to issue 20,000 shares. Jan 15. Sold 8,000 shares at P120 Mar. 10. Purchased 800 of its shares at P150. June 12. Sold 400 treasury shares. Dec. 31 Profit for the year is P316,000. 1. Compute for the total ordinary share capital as of December 31, 2019. 2. Compute for the retained earnings as of December 31, 2019.
ator Shoes, Inc., manufactures a line of stylish waterproof footwear. The following transactions relate to investments in common stock during 2021. March 1 Purchases 2,100 shares (10%) of Power Drive Corporation’s common stock for $53 per share. July 1 Receives a cash dividend of $1.55 per share. December 31 The fair value of Power Drive Corporation’s common stock is $66 per share. On February 1, 2022, Gator Shoes sells 525 shares of Power Drive Corporation’s common stock for $61 per share.Required:1. Record each of these transactions in 2021, including an adjustment on December 31 for the investment’s fair value, if appropriate. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) 2. Record the sale on February 1, 2022. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)
Gator Shoes, Inc., manufactures a line of stylish waterproof footwear. The following transactions relate to investments in common stock during 2021. March 1 Purchases 1,100 shares (10%) of Power Drive Corporation’s common stock for $43 per share. July 1 Receives a cash dividend of $1.30 per share. December 31 The fair value of Power Drive Corporation’s common stock is $52 per share. On February 1, 2022, Gator Shoes sells 275 shares of Power Drive Corporation’s common stock for $61 per share.'Required:1. Record each of these transactions in 2021, including an adjustment on December 31 for the investment’s fair value, if appropriate. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)
In January 2022, the management of Handley Corporation, a publicly-traded company, decides that it has sufficient cash to purchase some debt and equity securities to be held as trading investments. During the year, the following transactions occurred. Feb. 1 Purchased 1,100 shares of NJF common shares for $48,400. Mar. 1 Purchased 500 shares of SEK common shares for $20,000. Apr. 1 Purchased 73 $1,000, 8% CRT bonds for $74,200. Interest is receivable semi-annually on April 1 and October 1. July 1 Received a cash dividend of $0.60 per share on the NJF common shares. Aug. 1 Sold 180 shares of NJF common shares at $39.00 per share. Sept. 1 Received $2 per share cash dividend on the SEK common shares. Oct. 1 Received the semi-annual interest on the CRT bonds. Oct. 1 Sold the CRT bonds for $79,240. At December 31, Handley’s fiscal year end, the fair values of the NJF and SEK common shares were $38 and $29 per share, respectively. Record the above…
Southeast Bank invests in equity securities and prepares quarterly financial statements. At the beginning of the fourth quarter of 2019, the bank held as an investment in equity securities 220 shares of Eglan Company common stock that originally cost $5,940. At that time, these securities had a fair value of $5,720. During the fourth quarter, the bank engaged in the following transactions: Oct. 26 Purchased 340 shares of Farrell Company common stock for $34 per share. Nov. 26 Sold 220 shares of Eglan common stock for $25 per share. Dec. 10 Purchased 390 shares of Gray Company common stock for $43 per share. On December 31, 2019, the quoted market prices of the shares were as follows: Eglan Company, $56 per share; Farrell Company, $38 per share; and Gray Company, $42 per share. Required: 1. Prepare journal entries to record the preceding information for the fourth quarter. 2. Show what the bank reports on its fourth quarter 2019 income statement for these equity…
Oriole Company purchased 300 of the 1000 outstanding shares of Sheffield Company's common stock for $680000 on January 2, 2021. During 2021, Sheffield Company declared dividends of $70000 and reported earnings for the year of $400000.If Oriole Company uses the equity method of accounting for its investment in Sheffield Company, its Equity Investments (Sheffield) account at December 31, 2021 should be $680000. $779000. $800000. $659000.
Bramble Limited, a public company that follows IFRS and has a calendar year end, made the following purchases of investments in 2023. Bramble intends to sell these investments to earn short-term profits from appreciation in their prices and accounts for the investments using the FV-NI model. This is the first year in which Bramble invested in equity securities: 1. 2. On March 20, purchased 4,500 shares of Wu Inc. common shares at $27 per share plus commission of $480. On August 15, purchased 3,200 shares of Xi Inc. common shares at $23 per share plus commission of $420. On June 30, Bramble sold 2,700 shares of Wu Inc. at $29 less commission of $600. The December 31, 2023 market value of the Wu shares was $30 and of the Xi shares was $22. (f) (c) Your answer is correct. Prepare the adjusting entry needed at December 31, 2023. (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…
During your examination of the financial statements of Venus Corporation for the year ended December 31, 2020, you found a new account called "Investments." Your examination revealed that during 2020, Venus began a program of investments, and all investment-related transactions were entered in this account. Your analysis of this account for 2020 follows: VENUS CORPORATION Analysis of Investments Year Ended December 31, 2020 Date—2020 (i) Jupiter Ltd. Common Shares Feb. 14 Purchased 3,000 shares @ $ 55 per share $ 165,000 DR Jul. 26 Received 300 Jupiter common shares as a stock dividend. (Memorandum entry) Sep. 28 Sold the 300 Jupiter common shares received July 26 @ $ 70 per share $ 21,000 Credit (ii) Mars Ltd. Common Shares Apr. 30 Purchased 5,000 shares @ $ 40 per…
During the year ended December 31, 2024, Rakai Corporation, a public company, had the following transactions related to investments held for trading purposes: Feb. 1 Purchased 575 IBF common shares for $25,300. Mar. 1 Purchased 1,500 Raimundo common shares for $48,000. Apr. 1 Purchased $200,000 of CRT 3% bonds at par. Interest is payable semi-annually on April 1 and October 1. July 1 Received a cash dividend of $1.50 per share on the IBF common shares. Aug. 1 Sold 250 IBF common shares at 548 per share. Oct. 1 Received the semi-annual interest on the CRT bonds. 1 Sold the CRT bonds for $205,000. Dec. 31 The fair values of the IBF and Raimundo common shares were $50 and $28 per share, respectively. Instructions Record the transactions and any required year-end adjusting entries. Show the financial statement presentation of the investments and any related accounts in the financial statements for the year ended December 31, 2024.
The following information is available about Ayayai Corp.'s investments at December 31, 2023. This is the first year Ayayai has purchased securities for investment purposes. Securities 2,500 shares of Petra Corporation common shares 900 shares of Dugald Inc. preferred shares Ayayai follows IFRS. (a) Cost Account Titles and Explanation $25,000 18,000 $43,000 Fair Value $30,000 16,000 $46,000 Prepare the adjusting entry for December 31, 2023, assuming the investments are acquired for trading purposes and accounted for using the FV-NI model with no separate reporting of dividends and other types of FV-NI investment income and losses. (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 O for the amounts. List debit entry before credit entry.) Debit Credit