Rodeo has made periodic investments in other companies stocks. Below are pertinent information to prepare 2 0
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Rodeo has made periodic investments in other companies stocks. Below are pertinent information to prepare financial statements.
Rodeo has equity securities related to LA Mixture and Hollywood Hills. During this fiscal year, Rodeo purchased shares of LA Mixture for $; these shares currently have a value of Rodeos investment in Hollywood Hills has not been profitable; the company acquired shares of Hollywood in April at $ per share, a purchase that currently has a value of $
Prior to Rodeo invested $ in Driveway Industries and has not changed its holdings this year. This investment in Driveway Industries was valued at $ on December Rodeos ownership of Driveway Industries has a current value of $
Instructions
a Prepare the appropriate adjusting entries for Rodeo as of December to reflect the application of the fair value rule for the equity securities described above.
b For the equity securities presented above, describe how the results of the valuation adjustments made in a would be reflected in the body of Rodeos financial statements.
c Prepare the entries for the Driveway investment, assuming that Rodeo owns of Driveways shares. Driveway reported income of $ in and paid cash dividends of $
Related Book For
Intermediate Accounting IFRS
ISBN: 978-1119372936
3rd edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
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