Forte Inc. produces and sells theater set designs and costumes. The company began operations on January 1,

Question:

Forte Inc. produces and sells theater set designs and costumes. The company began operations on January 1, 2016. The following transactions relate to securities acquired by Forte Inc., which has a fiscal year ending on December 31:
2016 Jan. 22. Purchased 22,000 shares of Sankal Inc. as an available-for-sale security at $18 per share, including the brokerage commission.
Mar. 8. Received a cash of $0.22 per share on Sankal Inc. stock.
Sept. 8. A cash of $0.25 per share was received on the Sankal stock.
Oct. 17. Sold 3,000 shares of Sankal Inc. stock at $16 per share, less a brokerage commission of $75.
Dec. 31. Sankal Inc. is classified as an available-for-sale investment and is adjusted to a fair value of $25 per share. Use the valuation allowance for available-for-sale investments account in making the adjustment.
2017 Jan. 10. Purchased an influential interest in Imboden Inc. for $720,000 by purchasing 96,000 shares directly from the estate of the founder of Imboden Inc. There are 300,000 shares of Imboden Inc. stock outstanding.
Mar. 10. Received a cash of $0.30 per share on Sankal Inc. stock.
Sept. 12. Received a cash of $0.25 per share plus an extra of $0.05 per share on Sankal Inc. stock.
Dec. 31. Received $57,600 of cash dividends on Imboden Inc. stock. Imboden Inc. reported net income of $450,000 in 2017. Forte Inc. uses the equity method of accounting for its investment in Imboden Inc.
31. Sankal Inc. is classified as an available-for-sale investment and is adjusted to a fair value of $22 per share. Use the valuation allowance for available-for-sale investments account in making the adjustment for the decrease in fair value from $25 to $22 per share.
Instructions
1. Journalize the entries to record these transactions.
2. Prepare the investment-related asset and stockholders' equity presentation for Forte Inc. on December 31, 2017, assuming the Retained Earnings balance on December 31, 2017, is $389,000. Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...