Question: The beginning balance sheet of Kyndra Corporation included the following

The beginning balance sheet of Kyndra Corporation included the following:
Equity-method Investment in KTR Software.................................. $585,000
Kyndra Corporation completed the following investment transactions during the year:
Mar 21 Purchased 2,900 shares of Littleton, Inc., common stock as a long-term available-for-sale investment, paying $12.50 per share.
May 16 Received cash dividend of $1.20 per share on the Littleton investment.
Aug 17 Received cash dividend of $63,000 from KTR Software.
Dec 31 Received annual reports from KTR Software; net income for the year was $603,000. Of this amount, Kyndra’s proportion is 30%.
At year-end, the fair values of Kyndra Corporation’s investments are as follows: Littleton, $39,400; KTR, $695,000.

1. Record the transactions in the journal of Kyndra Corporation.
2. Post entries to the T-account for Equity-method Investment in KTR Software, and determine its balance at December 31.
3. Show how to report the Investment in Available-for-Sale Securities and the Equity-method Investment in KTR Software accounts on Kyndra Corporation’s balance sheet at December 31.

View Solution:

Sale on SolutionInn
  • CreatedJuly 25, 2014
  • Files Included
Post your question