Stockinvest2

Stockinvest2 - INVESTMENTS in STOCK Following is...

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Unformatted text preview: INVESTMENTS in STOCK Following is information on stock investments at Cornshell Company: STOCK Cost @ Time 0 Period 1 Investee Income Market Value @ B/S 1 Period 2 Investee Income Market Value @ B/S 2 Period 3 Investee Income Market Value @ B/S 3 AAA $20,000 $40,000 $17,000 $60,000 $21,000 $10,000 $25,000 BBB $30,000 $50,000 $38,000-$100,000 $29,000 $200,000 $40,000 CCC $50,000 $100,000 $54,000 $120,000 $63,000 $100,000 $59,000 1. Identify four alternative approaches for accounting for these three securities: 2. Under what conditions would each of the above alternatives constitute GAAP? 3. Complete the following for security AAA, assume the stock is sold for $28,000 in period 4 and Cornshells investment amounts to 5% of AAA's outstanding shares:: Accounting Choice Period 1 Income Period 1 B/S-Assets Period 1 B/S-Equity Period 2 Income Period 2 B/S-Assets Period 2 B/S-Equity Period 3 Income Period 3 B/S-Assets Period 3 B/S Equity Period 4 Realized Gain 4. Complete the following for security BBB, assume that Cornshell owns 10% of BBB's outstanding shares, BBB pays dividends (in 4....
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This note was uploaded on 02/28/2010 for the course SOM aim taught by Professor Are during the Spring '10 term at Texas El Paso.

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Stockinvest2 - INVESTMENTS in STOCK Following is...

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