Question
In: Accounting
Exercise 17-16 Culver Inc. acquired 20% of the outstanding common stock of Theresa Kulikowski Inc. on...
Exercise 17-16
Culver Inc. acquired 20% of the outstanding common stock of
Theresa Kulikowski Inc. on December 31, 2017. The purchase price
was $1,245,600 for 51,900 shares. Kulikowski Inc. declared and paid
an $0.85 per share cash dividend on June 30 and on December 31,
2018. Kulikowski reported net income of $699,000 for 2018. The fair
value of Kulikowski’s stock was $27 per share at December 31, 2018.
Assume that the security is a trading security.
Partially correct answer. Your answer is partially correct.
Try again.
Prepare the journal entries for Culver Inc. for 2017 and 2018,
assuming that Culver cannot exercise significant influence over
Kulikowski. (Credit account titles are automatically indented when
amount is entered. Do not indent manually. If no entry is required,
select "No Entry" for the account titles and enter 0 for the
amounts.)
Date
Account Titles and Explanation
Debit
Credit
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with incorrect answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with incorrect answer
Entry field with correct answer
Entry field with correct answer
Entry field with incorrect answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with incorrect answer
(To record dividend.)
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
(To record fair value.)
LINK TO TEXT
LINK TO TEXT
Partially correct answer. Your answer is partially correct.
Try again.
Prepare the journal entries for Culver Inc. for 2017 and 2018,
assuming that Culver can exercise significant influence over
Kulikowski. (Credit account titles are automatically indented when
amount is entered. Do not indent manually. If no entry is required,
select "No Entry" for the account titles and enter 0 for the
amounts.)
Date
Account Titles and Explanation
Debit
Credit
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with incorrect answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with incorrect answer
Entry field with correct answer
Entry field with correct answer
Entry field with incorrect answer
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with incorrect answer
(To record dividend.)
Entry field with correct answer
Entry field with correct answer
Entry field with correct answer
Entry field with incorrect answer now contains modified
data
Entry field with correct answer
Entry field with correct answer
(To record revenue.)
Solutions
Expert Solution
Held for trading securities- these are the securities which are intended to be held for short term purposes usually less than a year and basically to take advantage of short term price movements. These are valued at fair value in the balance sheet and any changes in the fair value is transferred to Income statement.
Accounting entries -
= 51,900 shares x 27 = 1,401,300; Cost - 1,245,600; fair value gain = 1,401,300-1,245,600 =155,700
ekkarill92 answered 1 year agoRelated Solutions
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