prepare the investment related asset and stockholders rsquo equity balance sheet dis 554509
PR 15-3B Stock investment transactions, equity method and available-for-sale securities
Samson Products, Inc., is a wholesaler of men’s hair products. The company began operations on January 1, 2012. The following transactions relate to securities acquired by Samson Products, Inc., which has a fiscal year ending on December 31:
Don't use plagiarized sources. Get Your Custom Essay on
prepare the investment related asset and stockholders rsquo equity balance sheet dis 554509
For $10/Page 0nly
|
2012 |
|
|
Jan. 3. |
Purchased 5,000 shares of Merlin Inc. as an available-for-sale investment at $22 per share, including the brokerage commission. |
|
July 8. |
Merlin Inc. stock was split two for one. The regular cash dividend of $0.40 per share was received on the stock after the stock split. |
|
Oct. 19. |
Sold 1,200 shares of Merlin Inc. stock at $13 per share, less a brokerage commission of $50. |
|
Dec. 12. |
Received the regular cash dividend of $0.40 per share. |
|
31. |
Merlin Inc. is classified as an available-for-sale investment and is adjusted to a fair value of $9.50 per share. Use the valuation allowance for available-for-sale investments account in making the adjustment. |
|
2013 |
|
|
Jan. 5. |
Purchased an influential interest in Juarez Co. for $540,000 by purchasing 60,000 shares directly from the estate of the founder of Juarez. There are 150,000 shares of Juarez Co. stock outstanding. |
|
July 9. |
Received the regular cash divided of $0.50 per share on Merlin Inc. stock. |
|
Dec. 8. |
Received the regular cash dividend of $0.50 per share plus an extra dividend of $0.05 per share on Merlin Inc. stock. |
|
Dec. 31. |
Received $21,000 of cash dividends on Juarez Co. stock. Juarez Co. reported net income of $96,000 in 2013. Samson Products uses the equity method of accounting for its investment in Juarez Co. |
|
31. |
Merlin Inc. is classified as an available-for-sale investment and is adjusted to a fair value of $10 per share. Use the valuation allowance for available-for-sale investments account in making the adjustment for the increase in fair value from $9.50 to $10 per share. |
Instructions
1. Journalize the entries to record the preceding transactions.
2. Prepare the investment-related asset and stockholders’ equity balance sheet disclosures for Samson Products, Inc., on December 31, 2013, assuming the Retained Earnings balance on December 31, 2013, is $395,000.
Calculator
Our features
We've got everything to become your favourite writing service
Money back guarantee
Your money is safe. Even if we fail to satisfy your expectations, you can always request a refund and get your money back.
Confidentiality
We don’t share your private information with anyone. What happens on our website stays on our website.
Our service is legit
We provide you with a sample paper on the topic you need, and this kind of academic assistance is perfectly legitimate.
Get a plagiarism-free paper
We check every paper with our plagiarism-detection software, so you get a unique paper written for your particular purposes.
We can help with urgent tasks
Need a paper tomorrow? We can write it even while you’re sleeping. Place an order now and get your paper in 8 hours.
Pay a fair price
Our prices depend on urgency. If you want a cheap essay, place your order in advance. Our prices start from $11 per page.