Emory Company purchased 15% of Milsaps at a cost of $300,000 on January 1, 2016. At...

Emory Company purchased 15% of Milsaps at a cost of $300,000 on January 1, 2016. At the time, there was no significant influence and the securities were considered available for sale. Milsaps reported earnings in 2016 of $100,000 and paid dividends of $40,000. At the end of 2016, the value of Milsap’s stock held by Emory had risen to $385,000.

Record the journal entries for 2016 on the books of Emory regarding the events of Milsaps.

Dr. Cr.+

Assume the same facts in problem number 3 above, except that Emory purchased 25%of Milsap’s for $300,000 and has significant influence.

Record the journal entries for 2016 on the books of Emory regarding the events of Milsaps.

Dr. Cr

Expert Solution

	Emory Company purchased 15% of Milsaps

	Journal entry for the year end 31december 2016


DATE	PARTICULARS	DEBIT ($)	CREDIT($)
1-Jan-16	15% Investemnt A/C Dr	300000
	To Cash A/C		300000
	(being stock purchased)


31-Dec-16	Cash A/C Dr	6000
	15% Investment A/C		6000
	(Being dividend recd ( 40000*15%)

31-Dec-16	15% Investment A/C Dr	15000
	To Investment Income Account		15000
	(share of profit recd (100000*15%)

31-Dec-16	15% Investment A/C Dr	85000
	To unrealised Gain A/C		85000
	(being investment increse as per fair value method)





	Emory Company purchased 25% of Milsaps
DATE	PARTICULARS	DEBIT ($)	CREDIT($)
1-Jan-16	25% Investemnt in Milsaps A/C Dr	300000
	To Cash A/C		300000
	(being stock purchased)


31-Dec-16	Cash A/C Dr	10000
	25% Investment A/C		10000
	(Being dividend recd ( 40000*25%)

31-Dec-16	15% Investment A/C Dr	25000
	To Investment Income Account		25000
	(share of profit recd (100000*25%)

ekkarill92 answered 1 year ago

Wardell Company purchased a mainframe on January 1, 2016, at a cost of $40,000. The computer...

Wardell Company purchased a mainframe on January 1, 2016, at a cost of $40,000. The computer was depreciated using the straight-line method over an estimated five-year life with an estimated residual value of $4,000. On January 1, 2018, the estimate of useful life was changed to a total of 10 years, and the estimate of residual value was changed to $400. Required: 1. Prepare the year-end journal entry for depreciation in 2018. No depreciation was recorded during the year. 2....

On January 1, 2016, the Harold Company purchased equipment at a cost of $400,000. The equipment...

On January 1, 2016, the Harold Company purchased equipment at a cost of $400,000. The equipment was expected to have a service life of 10 years and a $20,000 residual value. The company’s fiscal year-end is December 31, and the double-declining balance (DDB) depreciation method is used. During 2018, the company switched from the DDB to the straight-line method. In 2018, the adjusting entry to depreciation expense is: a. $22,500 b. $29,500 c. $31,625 d. $44,775

Wardell Company purchased a minicomputer on January 1, 2016, at a cost of $43,000. The computer...

Wardell Company purchased a minicomputer on January 1, 2016, at a cost of $43,000. The computer was depreciated using the straight-line method over an estimated five-year life with an estimated residual value of $10,000. On January 1, 2018, the estimate of useful life was changed to a total of 10 years, and the estimate of residual value was changed to $1,600. Required: 1. Prepare the year-end journal entry for depreciation in 2018. No depreciation was recorded during the year. 2....

Wardell Company purchased a minicomputer on January 1, 2016, at a cost of $58,000. The computer...

Wardell Company purchased a minicomputer on January 1, 2016, at a cost of $58,000. The computer was depreciated using the straight-line method over an estimated five-year life with an estimated residual value of $10,000. On January 1, 2018, the estimate of useful life was changed to a total of 10 years, and the estimate of residual value was changed to $2,200. Required: 1. Prepare the year-end journal entry for depreciation in 2018. No depreciation was recorded during the year. 2....

Wardell Company purchased a minicomputer on January 1, 2016, at a cost of $47,000. The computer...

Wardell Company purchased a minicomputer on January 1, 2016, at a cost of $47,000. The computer was depreciated using the straight-line method over an estimated five-year life with an estimated residual value of $5,000. On January 1, 2018, the estimate of useful life was changed to a total of 10 years, and the estimate of residual value was changed to $3,800. Required: 1. Prepare the year-end journal entry for depreciation in 2018. No depreciation was recorded during the year. 2....

Wardell Company purchased a mainframe on January 1, 2016, at a cost of $48,000. The computer...

Wardell Company purchased a mainframe on January 1, 2016, at a cost of $48,000. The computer was depreciated using the straight-line method over an estimated five-year life with an estimated residual value of $3,000. On January 1, 2018, the estimate of useful life was changed to a total of 10 years, and the estimate of residual value was changed to $1,200. Required: 1. Prepare the year-end journal entry for depreciation in 2018. No depreciation was recorded during the year. 2....

Wardell Company purchased a mini computer on January 1, 2016, at a cost of $48,500. The...

Wardell Company purchased a mini computer on January 1, 2016, at a cost of $48,500. The computer has been depreciated using the straight-line method over an estimated five-year useful life with an estimated residual value of $5,000. On January 1, 2018, the estimate of useful life was changed to a total of 10 years, and the estimate of residual value was changed to $900. Required: 1. Prepare the appropriate adjusting entry for depreciation in 2018 to reflect the revised estimate....

Wardell Company purchased a mini computer on January 1, 2016, at a cost of $45,100. The...

Wardell Company purchased a mini computer on January 1, 2016, at a cost of $45,100. The computer has been depreciated using the straight-line method over an estimated five-year useful life with an estimated residual value of $4,600. On January 1, 2018, the estimate of useful life was changed to a total of 10 years, and the estimate of residual value was changed to $900. Required: 1. Prepare the appropriate adjusting entry for depreciation in 2018 to reflect the revised estimate....

On January 1, 2016, Verlin Co. purchased new machinery for $300,000. The machinery has an estimated...

On January 1, 2016, Verlin Co. purchased new machinery for $300,000. The machinery has an estimated useful life of ten years, and depreciation is computed by the sum-of-the-years'-digits method. 20,000 Salvage. A) The accumulated depreciation on this machinery at December 31, 2017 is __________. Please prepare/show the journal entries for 12/31/2016; 12/31/2017; and 12/31/2018.

1.On January 15, 2016, Bravo Company purchased $1,500 of construction supplies to last for 3 months...

1.On January 15, 2016, Bravo Company purchased $1,500 of construction supplies to last for 3 months on account, from the Zulu Company. Prepare Bravo Company's general journal entry (without explanation). 2. On January 15, 2016, Bravo Company purchased $3,000 of construction supplies to last for 3 months, from the Zulu Company. Bravo paid for half of the supplies with cash and the remainder on account. 3. On January 31, 2016, Bravo withdrew $3,000 from the company. Prepare the general journal...

Question