In: Accounting
On December 31, 2020, Ivanhoe Associates owned the following securities, held as a long-term investment. The securities are not held for influence or control of the investee.
Common Stock |
Shares |
Cost |
||
---|---|---|---|---|
Gehring Co. |
2,000 | $64,000 | ||
Wooderson Co. |
5,200 | 36,400 | ||
Kitselton Co. |
1,800 | 39,600 |
On December 31, 2020, the total fair value of the securities was
equal to its cost. In 2021, the following transactions
occurred:
Aug. | 1 | Received $0.50 per share cash dividend on Gehring Co. common stock. | |
Sept. | 1 | Sold 1,560 shares of Wooderson Co. common stock for cash at $6 per share. | |
Oct. | 1 | Sold 800 shares of Gehring Co. common stock for cash at $35 per share. | |
Nov. | 1 | Received $2 per share cash dividend on Kitselton Co. common stock. | |
Dec. | 15 | Received $0.50 per share cash dividend on Gehring Co. common stock. | |
Dec. | 31 | Received $2 per share annual cash dividend on Wooderson Co. common stock. |
At December 31, the fair values per share of the common stocks
were: Gehring Co. $34, Wooderson Co. $6, and Kitselton Co. $20.
Journalize the 2021 transactions and post to the account Stock Investments. (Use the T-account form.) (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. Record journal entries in the order presented in the problem.)
Date |
Account Titles and Explanation |
Debit |
Credit |
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choose a transaction date Aug. 1Sept. 1Oct. 1Nov. 1Dec. 15Dec. 31 |
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choose a transaction date Aug. 1Sept. 1Oct. 1Nov. 1Dec. 15Dec. 31 |
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choose a transaction date Aug. 1Sept. 1Oct. 1Nov. 1Dec. 15Dec. 31 |
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choose a transaction date Aug. 1Sept. 1Oct. 1Nov. 1Dec. 15Dec. 31 |
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choose a transaction date Aug. 1Sept. 1Oct. 1Nov. 1Dec. 15Dec. 31 |
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Stock Investments |
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choose a transaction date Jan. 1 Bal.July 1Aug. 1Sept. 1Oct. 1Nov. 1Dec. 15Dec. 31Dec. 31 Bal. |
enter a debit amount |
choose a transaction date Jan. 1 Bal.July 1Aug. 1Sept. 1Oct. 1Nov. 1Dec. 15Dec. 31Dec. 31 Bal. |
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enter a debit balance |
choose the end date of the accounting period Jan. 1 Bal.July 1Aug. 1Sept. 1Oct. 1Nov. 1Dec. 15Dec. 31Dec. 31 Bal. |
List of Accounts
Prepare the adjusting entry at December 31, 2021, to show the securities at fair value. (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 |
---|---|---|---|
Dec. 31 |
enter an account title for the adjusting entry on December 31 |
enter a debit amount |
enter a credit amount |
enter an account title for the adjusting entry on December 31 |
enter a debit amount |
enter a credit amount |
eTextbook and Media
List of Accounts
Show the balance sheet presentation of the investments at December 31, 2021. At this date, Ivanhoe Associates has common stock $1,411,000 and retained earnings $1,156,000.
Ivanhoe Associates |
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$enter a dollar amount |