Question

Equity Method On January 2, Yorkshire Company acquired 33% of the outstanding stock of Fain Company...

Equity Method

On January 2, Yorkshire Company acquired 33% of the outstanding stock of Fain Company for $330,000. For the year ended December 31, Fain Company earned income of $86,000 and paid dividends of $26,000.

Prepare the entries for Yorkshire Company for the purchase of the stock, the share of Fain income, and the dividends received from Fain Company.

Homework Answers

Answer #1

Ans- Journal Entries

Date Account Title and Explanation Debit ($) Credit ($)
Jan 2 Investment in stock of Fain 330,000
Cash 330,000
(To record the purchase of 33% outstanding stock in Fain Company)
Dec.31 Investment in stock of Fain 28,380
Revenue from investment ($86,000*33%) 28,380
(To record the share of net income in Fain Company)
Dec.31 Cash 8,580
Investment in stock of Fain ($26,000*33%) 8,580
(To record the receipt as cash dividend)

Kindly give thumbsup if u like my answer...Thanks!!!

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
15-2 15-03 Equity Method On January 2, Yorkshire Company acquired 31% of the outstanding stock of...
15-2 15-03 Equity Method On January 2, Yorkshire Company acquired 31% of the outstanding stock of Fain Company for $330,000. For the year ended December 31, Fain Company earned income of $86,000 and paid dividends of $26,000. Prepare the entries for Yorkshire Company for the purchase of the stock, the share of Fain income, and the dividends received from Fain Company. Jan. 2 - Purchase Dec. 31 - Income Dec. 31 - Dividends
Equity Method On January 2, Yorkshire Company acquired 31% of the outstanding stock of Fain Company...
Equity Method On January 2, Yorkshire Company acquired 31% of the outstanding stock of Fain Company for $440,000. For the year ended December 31, Fain Company earned income of $114,000 and paid dividends of $35,000. Prepare the entries for Yorkshire Company for the purchase of the stock, the share of Fain income, and the dividends received from Fain Company.
On January 2, Peyroux Company acquired 36% of the outstanding stock of Gruden Company for $553,000....
On January 2, Peyroux Company acquired 36% of the outstanding stock of Gruden Company for $553,000. For the year ended December 31, Gruden Company earned income of $100,800 and paid dividends of $22,500. Prepare the entries for Peyroux Company for the purchase of the stock, the share of Gruden income, and the dividends received from Gruden Company. Refer to the Chart of Accounts for exact wording of account titles.
On January 2, Cohan Company acquired 37% of the outstanding stock of Sanger Company for $715,500....
On January 2, Cohan Company acquired 37% of the outstanding stock of Sanger Company for $715,500. For the year ended December 31, Sanger Company earned income of $108,700 and paid dividends of $26,400. Prepare the entries for Cohan Company for the purchase of the stock, the share of Sanger income, and the dividends received from Sanger Company. Refer to the Chart of Accounts for exact wording of account titles. On January 2, Cohan Company acquired 37% of the outstanding stock...
On January 2, Cohan Company acquired 40% of the outstanding stock of Sanger Company for $677,000....
On January 2, Cohan Company acquired 40% of the outstanding stock of Sanger Company for $677,000. For the year ended December 31, Sanger Company earned income of $149,000 and paid dividends of $27,500. Prepare the entries for Cohan Company for the purchase of the stock, the share of Sanger income, and the dividends received from Sanger Company. Refer to the Chart of Accounts for exact wording of account titles. CHART OF ACCOUNTS Cohan Company General Ledger ASSETS 110 Cash 111...
On January 2, 2018, MBH Inc. acquired 30% of the voting common stock of Construction Corporation...
On January 2, 2018, MBH Inc. acquired 30% of the voting common stock of Construction Corporation as a long-term investment. Data from Construction Corporation's financial statements for the year ended December 31, 2018, include the following: Net income $ 153,000 Dividends paid $ 78,000     Required: Prepare any necessary journal entries for MBH at December 31, 2018, under the equity method of accounting for investments. (If no entry is required for a transaction/event, select "No journal entry required" in the...
Equity Method for Stock Investment On January 4, Year 1, Ferguson Company purchased 96,000 shares of...
Equity Method for Stock Investment On January 4, Year 1, Ferguson Company purchased 96,000 shares of Silva Company directly from one of the founders for a price of $57 per share. Silva has 300,000 shares outstanding, including the Daniels shares. On July 2, Year 1, Silva paid $278,000 in total dividends to its shareholders. On December 31, Year 1, Silva reported a net income of $897,000 for the year. Ferguson uses the equity method in accounting for its investment in...
Equity Method for Stock Investment On January 4, Year 1, Ferguson Company purchased 87,500 shares of...
Equity Method for Stock Investment On January 4, Year 1, Ferguson Company purchased 87,500 shares of Silva Company directly from one of the founders for a price of $64 per share. Silva has 250,000 shares outstanding, including the Daniels shares. On July 2, Year 1, Silva paid $236,000 in total dividends to its shareholders. On December 31, Year 1, Silva reported a net income of $787,000 for the year. Ferguson uses the equity method in accounting for its investment in...
Equity Method for Stock Investment On January 4, Year 1, Ferguson Company purchased 112,000 shares of...
Equity Method for Stock Investment On January 4, Year 1, Ferguson Company purchased 112,000 shares of Silva Company directly from one of the founders for a price of $60 per share. Silva has 400,000 shares outstanding, including the Daniels shares. On July 2, Year 1, Silva paid $302,000 in total dividends to its shareholders. On December 31, Year 1, Silva reported a net income of $1,007,000 for the year. Ferguson uses the equity method in accounting for its investment in...
Equity Method for Stock Investment On January 4, Year 1, Ferguson Company purchased 50,000 shares of...
Equity Method for Stock Investment On January 4, Year 1, Ferguson Company purchased 50,000 shares of Silva Company directly from one of the founders for a price of $36 per share. Silva has 200,000 shares outstanding, including the Daniels shares. On July 2, Year 1, Silva paid $123,000 in total dividends to its shareholders. On December 31, Year 1, Silva reported a net income of $467,000 for the year. Ferguson uses the equity method in accounting for its investment in...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT