In January 2022, the management of Blossom Company concludes that it has sufficient cash to permit some short-term investments in debt and equity securities. During the year, the following transactions occurred. Feb. 1 Mar. 1 Apr. 1 July 1 Aug. 1 Sept. 1 Oct. 1 Oct. 1 Purchased 700 shares of Muninger common stock for $35,000. Purchased 900 shares of Tatman common stock for $22.500. Purchased 60 of $1,000, 8% Yoakem bonds for $60,000. Interest is payable semiannually on April 1 and October 1. Received a cash dividend of $0.70 per share on the Muninger common stock. Sold 233 shares of Muninger common stock at $65 per share. Received a $2 per share cash dividend on the Tatman common stock. Received the semiannual interest on the Yoakem bonds. Sold the Yoakem bonds for $58,000. At December 31, the fair value of the Muninger and Tatman common stocks were $51 and $24 per share respectively. These stock investments by Blossom Company provide less than a 20% ownership interest.

In January 2022, the management of Blossom Company concludes that it has sufficient cash to permit some short-term investments in debt and equity securities. During the year, the following transactions occurred. Feb. 1 Mar. 1 Apr. 1 July 1 Aug. 1 Sept. 1 Oct. 1 Oct. 1 Purchased 700 shares of Muninger common stock for $35,000. Purchased 900 shares of Tatman common stock for $22.500. Purchased 60 of $1,000, 8% Yoakem bonds for $60,000. Interest is payable semiannually on April 1 and October 1. Received a cash dividend of $0.70 per share on the Muninger common stock. Sold 233 shares of Muninger common stock at $65 per share. Received a $2 per share cash dividend on the Tatman common stock. Received the semiannual interest on the Yoakem bonds. Sold the Yoakem bonds for $58,000. At December 31, the fair value of the Muninger and Tatman common stocks were $51 and $24 per share respectively. These stock investments by Blossom Company provide less than a 20% ownership interest.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 25E

See similar textbooks

Similar questions

Comprehensive The following are Farrell Corporations balance sheets as of December 31, 2019, and 2018, and the statement of income and retained earnings for the year ended December 31, 2019: Additional information: a. On January 2, 2019, Farrell sold equipment costing 45,000, with a book value of 24,000, for 19,000 cash. b. On April 2, 2019, Farrell issued 1, 000 shares of common stock for 23,000 cash. c. On May 14, 2019, Farrell sold all of its treasury stock for 25,000 cash. d. On June 1, 2019, Farrell paid 50, 000 to retire bonds with a face value (and book value) of 50, 000. e. On July 2, 2019, Farrell purchased equipment for 63, 000 cash. f. On December 31, 2019, land with a fair market value of 150,000 was purchased through the issuance of a long-term note in the amount of 150,000. The note bears interest at the rate of 15% and is due on December 31, 2021. g. Deferred taxes payable represent temporary differences relating to the use of accelerated depreciation methods for income tax reporting and the straight-line method for financial statement reporting. Required: 1. Prepare a spreadsheet to support a statement of cash flows for Farrell for the year ended December 31, 2019, based on the preceding information. 2. Prepare the statement of cash flows. (Appendix 21.1) Spreadsheet and Statement Refer to the information for Farrell Corporation in P21-13. Required: 1. Using the direct method for operating cash flows, prepare a spreadsheet to support a 2019 statement of cash flows. (Hint: Combine the income statement and December 31, 2019, balance sheet items for the adjusted trial balance. Use a retained earnings balance of 291,000 in this adjusted trial balance.) 2. Prepare the statement of cash flows. (A separate schedule reconciling net income to cash provided by operating activities is not necessary.)
Comprehensive The following are Farrell Corporations balance sheets as of December 31, 2019, and 2018, and the statement of income and retained earnings for the year ended December 31, 2019: Additional information: a. On January 2, 2019, Farrell sold equipment costing 45,000, with a book value of 24,000, for 19,000 cash. b. On April 2, 2019, Farrell issued 1,000 shares of common stock for 23,000 cash. c. On May 14, 2019, Farrell sold all of its treasury stock for 25,000 cash. d. On June 1, 2019, Farrell paid 50,000 to retire bonds with a face value (and book value) of 50,000. e. On July 2, 2019, Farrell purchased equipment for 63,000 cash. f. On December 31, 2019. land with a fair market value of 150,000 was purchased through the issuance of a long-term note in the amount of 150,000. The note bears interest at the rate of 15% and is due on December 31, 2021. g. Deferred taxes payable represent temporary differences relating to the use of accelerated depreciation methods for income tax reporting and the straight-line method for financial statement reporting. Required: 1. Prepare a spreadsheet to support a statement of cash flows for Farrell for the year ended December 31, 2019, based on the preceding information. 2. Prepare the statement of cash flows.
In January 2022, the management of Sheridan Company concludes that it has sufficient cash to permit some short-term investments in debt and equity securities. During the year, the following transactions occurred. Feb. 1 Purchased 600 shares of Muninger common stock for $30,000. Mar. 1 Purchased 800 shares of Tatman common stock for $20,000. Apr. 1 Purchased 60 of $1,160,7% Yoakem bonds for $69,600. Interest is payable semiannually on April 1 and October 1. July 1 Received a cash dividend of $0.70 per share on the Muninger common stock. Aug. 1 Sold 200 shares of Muninger common stock at $65 per share. Sept. 1 Received a $1 per share cash dividend on the Tatman common stock. Oct. 1 Received the semiannual interest on the Yoakem bonds. Oct. 1 Sold the Yoakem bonds for $67,900. At December 31, the fair value of the Muninger and Tatman common stocks were $51 and $24 per share respectively. These stock investments by Sheridan Company provide less than a 20% ownership interest.
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…
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…
Agustin Company has the following transactions relating to its investments during 2022. January 5 - Acquired 10,000 shares of Abalos Company for P1,000,000 paying additional P20,000 for brokerage fee and another P5,000 for commission. Received dividends from Abalos declared January 2, 2022 to stockholders of record January 10, 2022, P20,000. How much should the investment account be debited if the shares are held for trading?
In 2023, Chen Corporation purchased treasury stock with a cost of $54,000. During the year, the company declared and paid dividends of $12,000 and issued bonds payable for $900,000. Net cash provided by financing activities for 2023 is: A. $834,000. B. $900,000. C. $846,000. D. $888,000.
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
In 2023, Chen Corporation purchased treasury stock with a cost of $47,000. During the year, the company declared and paid dividends of $14,000 and issued bonds payable for $1,100,000. Net cash provided by financing activities for 2023 is: A $1,086,000.B. $1,053,000.C. $1,039.000.D. $1,100,000.
Inc. identified the following selected transactions occurring during the year ended December 31, 2018: a. issued 850 shares of $4 par common stock for cash of $25,000. b. issued 4,800 shares of $4 par common stock for building with fair market value of $98,000. c. purchased new truck with fair market value of $31,000. financed it 100% with long-term note. d. retired short-term notes $27,000 by issuing 2,7000 shares of $4 par common stock. e. paid long-term notes of $10,000 to Bank of Tallahassee. issued new long-term note of $20,000 to Bank of Trust. Identify any non-cash transactions that occurred during the year, and show how they would be reported in the non-cash investing and financing activities section of the statement of cash flows. Inc Statement of Cash Flows (partial) Year Ended December 31, 2018 Non-cash Investing and Financial Activities Total non-cash Investing and Financing Activities
Live Large Inc. had the following transactions involving non-strategic investments during 2023. 2023 Apr. 1 Paid $100,050 to buy a 90-day term deposit, $100,000 principal amount, 5.0 %, dated April 1. There was a $50 transaction fee included in the above-noted payment amount. June 12 Purchased 3,000 common shares of Blue Balloon Ltd. at $22.25. There was a $50 transaction fee included in the above-noted payment amount. 9 Purchased 1,800 common shares of Purple Car Corp. at $49.50. There was a $50 transaction fee included in the above-noted payment amount. 20 Purchased 700 common shares of Yellow Tech Ltd. at $15.75. There was a $50 transaction fee included in the above-noted payment amount. July 1 Purchased for $67,412 a 7.0 %, $65,000 Space Explore Inc. bond that matures in eight years when the market interest rate was 6.4%. There was a $50 transaction fee included in the above-noted payment amount. Interest is paid semiannually beginning December 31, 2023. Live Large Inc. plans to…
3. STRANGE Inc. has the following transactions relating to investments during 2021: January 8 Acquired 10,000 shares of ANCIENT ONE Inc. for P 1,000,000 paying additional P 20,000 for brokerage and another P 5,000 for commission. February 29 Received dividends from ANCIENT ONE Inc. declared January 3, 2020 to the stockholder of record January 31, 2020, P 20,000. On December 31, 2021 and 2022, the market value per share of the ANCIENT ONE stock is Php 95 and Php 120, respectively. Required: Prepare journal entries for each of the transactions enumerated above for 2021 and 2022, assuming: a. Investment in equity securities - FVPL b. Investment in equity securities - FVOCI