Question: On February 1 2014 Holl Co decides to invest excess

On February 1, 2014, Holl Co. decides to invest excess cash of $ 20,000 by purchasing 1,000 shares of Cooke, Inc. stock at $ 20 per share. At year- end, December 31, 2014, Cooke’s market price was $ 22 per share. The investment is categorized as a trading investment.

Requirements
1. Journalize the transactions for Holl’s investment in Cooke, Inc. for 2014.
2. In what category and at what value would Holl report the asset on the December 31, 2014, balance sheet? In what account would the market price change in Cooke’s stock be reported, if at all?
3. What was the net effect of the investment on Holl’s net income for the year ended December 31, 2014?


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  • CreatedJanuary 16, 2015
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