Course Hero Logo

Be 172 on january 1 2022 redwood creek company

Course Hero uses AI to attempt to automatically extract content from documents to surface to you and others so you can study better, e.g., in search results, to enrich docs, and more. This preview shows page 42 - 44 out of 64 pages.

Be. 172On January 1, 2022, Redwood Creek Company purchased 5,000 shares of Monticello Companystock for $300,000. Redwood Creek’s investment represents 30 percent of the total outstandingshares of Monticello. During 2022, Monticello paid total dividends of $100,000 and reported netincome of $290,000. What revenue does Redwood report related to this investment, and what isthe amount to be reported as an investment in Monticello stock at December 31?Ans: N/A, LO: 2, Bloom: AP, Difficulty: Medium, Min: 5, AACSB: Analytic, AICPA BB: Legal/Regulatory Perspective, AICPA FC: Reporting, AICPA PC:Problem Solving, IMA: ReportingH-42
Be. 173On January 1, Ollinger Company purchased a 25% equity investment in Fava Company for$300,000. At December 31 Fava declared and paid a $20,000 dividend and reported net incomeof $120,000.Instructions(a)Journalize the transactions(b)Determine the amount to be reported as an investment in Fava stock at December 31.Ans: N/A, LO: 2, Bloom: AP, Difficulty: Medium, Min: 8, AACSB: Analytic, AICPA BB: Legal/Regulatory Perspective, AICPA FC: Measurement, AICPA PC:Problem Solving, IMA: FSAFOR INSTRUCTOR USE ONLY
Reporting and Analyzing InvestmentsSolution 173(8–12 minutes)
Be. 174At January 1, 2022, the stock (less than 20% ownership) portfolio held by Darma Corporationconsisted of the following investments:1.2,500 shares of H2 common stock purchased for $43 per share.2.1,500 shares of Krypto common stock purchased for $50 per share.At December 31, 2022, the fair values per share were H2 $36 and Krypto $54.Instructions(a)Prepare a schedule showing the cost and fair value of the portfolio at December 31, 2022.(b)Prepare the adjusting entry to report the portfolio at fair value at December 31, 2022.Ans: N/A, LO: 3, Bloom: AP, Difficulty: Medium, Min: 8, AACSB: Analytic, AICPA BB: Legal/Regulatory Perspective, AICPA FC: Measurement, AICPA PC:Problem Solving, IMA: FSASolution 174(8-10 min.)

Upload your study docs or become a

Course Hero member to access this document

Upload your study docs or become a

Course Hero member to access this document

End of preview. Want to read all 64 pages?

Upload your study docs or become a

Course Hero member to access this document

Term
Fall
Professor
professor_unknown
Tags

Newly uploaded documents

Show More

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture