Johnson Controls is a manufacturing company and had the following investment related activities during 20Y3: 1....
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Johnson Controls is a manufacturing company and had the following investment related activities during 20Y3: 1. The company purchased Jones & Co.'s 5-year, 5%, $100,000 bond. The bond was purchased on January 1, 20Y3 for $95,788 to yield 6% interest. The bond pays annual interest on December 31. Johnson is holding the investment as available-for-sale. At December 31, 20Y3, the bond had a fair market value of $97,500. 2. The company purchased 6,000 shares of Dobson Ltd. common stock at a cost of $255,000 on July 31, 20Y3. These shares do not give Johnson significant influence over Dobson. On October 31, 20Y3, Dobson Ltd. paid a $2 per share cash dividend. At December 31, 20Y3, Dobson Ltd. was trading at $40 a share. 3. On January 1, 20Y3, the company invested in Rothrock Industries by acquiring 30% of Rothrock's outstanding stock for $21,500,000. During 20Y3, Rothrock Industries reported net income of $5,000,000 and paid cash dividends totaling $1,000,000. At December 31, 20Y3, Rothrock Industries had a market value of $75,000,000. Note: Ignore any excess price issues. REQUIRED Using the following templates, show how each of the above transactions impacted Johnson's cash flows, income, and balance sheet for 20Y3. Round all amounts to the nearest whole dollar. The impact on the balance sheet should reflect cumulative changes to the statement. These amounts will not necessarily equal the December 31, 20Y3 ending balances in the balance sheet accounts. Some lines might not have answers. List account names or transaction descriptions in the first column and amounts in the remaining columns. NOTE: The t-accounts are not required, but it is strongly suggested that you work the problems using t- accounts first and then transfer your answers to the appropriate financial statements. ASSETS LIABILITIES + - EQUITY IMPACT ON CURRENT PERIOD CASH FLOW Net Impact on Current Period Cash Flow Net Impact on Current Period Earnings ASSETS: Cumulative Change in Assets LIABILITIES+EQUITY: Cumulative Change in Liabilities + Equity Jones & Co Jones & Co Jones & Co Dobson Ltd. Dobson Ltd. Dobson Ltd. Rothrock Industries Rothrock Industries Rothrock Industries CHAPTER 17 HANDOUT PAGE: Johnson Controls is a manufacturing company and had the following investment related activities during 20Y3: 1. The company purchased Jones & Co.'s 5-year, 5%, $100,000 bond. The bond was purchased on January 1, 20Y3 for $95,788 to yield 6% interest. The bond pays annual interest on December 31. Johnson is holding the investment as available-for-sale. At December 31, 20Y3, the bond had a fair market value of $97,500. 2. The company purchased 6,000 shares of Dobson Ltd. common stock at a cost of $255,000 on July 31, 20Y3. These shares do not give Johnson significant influence over Dobson. On October 31, 20Y3, Dobson Ltd. paid a $2 per share cash dividend. At December 31, 20Y3, Dobson Ltd. was trading at $40 a share. 3. On January 1, 20Y3, the company invested in Rothrock Industries by acquiring 30% of Rothrock's outstanding stock for $21,500,000. During 20Y3, Rothrock Industries reported net income of $5,000,000 and paid cash dividends totaling $1,000,000. At December 31, 20Y3, Rothrock Industries had a market value of $75,000,000. Note: Ignore any excess price issues. REQUIRED Using the following templates, show how each of the above transactions impacted Johnson's cash flows, income, and balance sheet for 20Y3. Round all amounts to the nearest whole dollar. The impact on the balance sheet should reflect cumulative changes to the statement. These amounts will not necessarily equal the December 31, 20Y3 ending balances in the balance sheet accounts. Some lines might not have answers. List account names or transaction descriptions in the first column and amounts in the remaining columns. NOTE: The t-accounts are not required, but it is strongly suggested that you work the problems using t- accounts first and then transfer your answers to the appropriate financial statements. ASSETS LIABILITIES + - EQUITY IMPACT ON CURRENT PERIOD CASH FLOW Net Impact on Current Period Cash Flow Net Impact on Current Period Earnings ASSETS: Cumulative Change in Assets LIABILITIES+EQUITY: Cumulative Change in Liabilities + Equity Jones & Co Jones & Co Jones & Co Dobson Ltd. Dobson Ltd. Dobson Ltd. Rothrock Industries Rothrock Industries Rothrock Industries CHAPTER 17 HANDOUT PAGE:
Expert Answer:
Answer rating: 100% (QA)
1 2 3 Date Jan 1 20Y3 July 3120Y3 Oct31 20Y3 31Dec 1Jan 31De... View the full answer
Related Book For
Cost management a strategic approach
ISBN: 978-0073526942
5th edition
Authors: Edward J. Blocher, David E. Stout, Gary Cokins
Posted Date:
Students also viewed these accounting questions
-
In the second week, you selected a manufacturing company and described its products and costs. For this week, please refer back to that company and perform trend analysis for the most recent 4 years...
-
MamakMaju Sdn Bhd is a manufacturing company and closes its accounts annually on 31 December. The company acquired a factory building for RM1,300,000 during the year of assessment 2018. In 2019, the...
-
Pittsburgh-Walsh Company (PWC) is a manufacturing company whose product line consists of lighting fixtures and electronic timing devices. The Lighting Fixtures Division assembles units for the...
-
machine element is made of an alloy with Yield strength of 200 Mpa and fracture strain is 0.08. A machine element is characterized by the normal stress components as shown in the figure. The Answer...
-
Mills, Inc., sold 120,000 cases of glue at $20 per case during 2014. Its beginning inventory consisted of 20,000 cases at a cost of $12 per case. During 2014, it purchased 60,000 cases at $14 per...
-
In tensile test of mild steel, necking starts from: (a) Proportional limit (b) Plastic limit (c) Ultimate point (d) Rupture point
-
How are internal auditing and independent auditing related?
-
Ryan Corporation incurred the following costs while manufacturing its product. Instructions (a) Identify each of the above costs as direct materials, direct labor, manufacturing overhead, or period...
-
Fredrick is an Australian resident and have recently purchased an established home in SA for a purchase price of $550,000, settlement date being 31st July 2022. They are the first home buyers and...
-
It is often asserted that educational systems in developing countries, especially in rural areas, are unsuited to the real social and economic needs of development. Do you agree or disagree with this...
-
You have $65,000. You put 21?% of your money in a stock with an expected return of 15?%, $31,000 in a stock with an expected return of 13?%, and the rest in a stock with an expected return of 19?%....
-
Study the scenario and complete the question(s) that follow(s): Comicon Kimiko Entertainment hosts monthly provincial Comic Con events within the different provinces in South Africa. Due to their...
-
A process at Printwright, Inc.'s largest facility is used to make plastic gears for a computer printer. The data found in the worksheet Prob. 9-15 were gathered by a quality analyst. The gears were...
-
Below is data taken from a survey from customers of a northeastern USA metropolitan airport: Comment Time of day Comment Time of day Parking a mess 10:00am Lines too long 2:00pm Get more TSA access...
-
Assume the periodic message signal m(t), shown below, is applied to a phase modulator with a phase sensitivity of kp-2n rad/Volt. Assume a carrier frequency of fe=1 Hz. a) Sketch the phase of the...
-
The system function of a causal system is given below. H(s) = =11 a) (2) Sketch the pole-zero plot. Show important values. b) (2) Specify the ROC. Briefly explain your answer. c) (1) What is the type...
-
4. Consider the "Q" model of investment with adjustment costs. Equilibrium suggests that capital K(t) evolves as K(t) C-(q(t) 1) (normalizing the number of firms N = 1 and assuming no depreciation),...
-
CRUZ, INC. Comparative Balance Sheets December 31, 2015 CRUZ, INC. Income Statement For Year Ended December 31, 2015 Required Use the indirect method to prepare the cash provided or used from...
-
As a management accountant in a small real estate services firm, you have become aware of a strategic initiative in your firm to promote its services to a new class of customers. Currently, most of...
-
Why do firms using JIT systems often have little interest in materials price variances?
-
Greenbelt Hospital has the following activities in its value chain of providing service to each inpatient admission: 1. Schedule patient. 2. Verify insurance. 3. Admit patient. 4. Prepare patients...
-
The central difference approximation of \(d^{4} W / d x^{4}-\beta^{4} W=0\) at grid point \(i\) with step size \(h\) is a. \(W_{i+2}-4 W_{i+1}+\left(6-h^{4} \beta^{4} ight) W_{i}-4...
-
What is the difference between explicit and implicit integration methods?
-
Find the solution of a spring-mass-damper system governed by the equation \(m \ddot{x}+c \dot{x}+k x=F(t)=\delta F . t\) with \(m=c=k=1\) and \(\delta F=1\). Assume the initial values of \(x\) and...
Study smarter with the SolutionInn App