Question: Turner Company purchased 40 of the outstanding stock of ICA
Turner Company purchased 40% of the outstanding stock of ICA Company for $10,000,000 on January 2, 2011. Turner elects the fair value option to account for the investment. During 2011, ICA earns $750,000 of income and on December 30 pays a dividend of $500,000. On December 31, 2011, the fair value of Turner's investment has increased to $11,500,000. What journal entries would Turner make to account for this investment during 2011, assuming Turner will account for the investment similar to how it would account for a trading security?
Answer to relevant QuestionsLED Corporation owns 100,000 shares of Branch Pharmaceuticals common stock and classifies its investment as securities available-for-sale. The market price of Branch's stock fell more than 30%, by $4.50 per share, due to ...F&T Corporation is a confectionery wholesaler that frequently buys and sells securities to meet various investment objectives. The following selected transactions relate to FF&T's investment activities during the last two ...At December 31, 2011, Hull-Meyers Corp. had the following investments that were purchased during 2011, its first year of operations:No investments were sold during 2011. All securities except Security D and Security F are ...On January 1, 2011, Cameron Inc. bought 20% of the outstanding common stock of Lake Construction Company for $300 million cash. At the date of acquisition of the stock, Lake's net assets had a fair value of $900 million. ...In early December of 2011, Kettle Corp purchased $50,000 of Icalc Company common stock, which constitutes less than 1% of Icalc's outstanding shares. By December 31, 2011, the value of Icalc's investment had fallen to ...
Post your question