25. Investments - Equity Securities - Prepare the journal entries as described below for Carp Logistics...
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25. Investments - Equity Securities - Prepare the journal entries as described below for Carp Logistics under BOTH Fair Value Method (Passive) and Equity Method (Significant Influence). If “No Entry" is needed, please indicate. a) On May 2, 2019, Carp Logistics acquired 5,000 shares of common stock of Leo Transportation Corporation for $50,000 ($10/share). Fair Value Method Account Description Account Description Equity Method Debit Debit Credit Credit b) On August 15, 2019, Leo Transportation declared and paid a dividend of $4,000 to all shareholders. Carp Logistics received $800 (20% of the total dividend). Fair Value Method Equity Method Account Description Debit Credit Account Description Debit Credit c) On December 31, 2019, Leo Transportation Corporation reported net income of $80,000. (Carp's 20% share is $1,600). Equity Method Debit Fair Value Method Account Description Debit Credit Account Description Credit d) At December 31, 2019, Leo Transportation Corporation shares were trading at $9 per share and the fair value of Carp's shares was $45,000 (S9 per share x 5,000 shares) Equity Method Debit Fair Value Method Account Description Debit Account Description Credit Credit 25. Investments - Equity Securities - Prepare the journal entries as described below for Carp Logistics under BOTH Fair Value Method (Passive) and Equity Method (Significant Influence). If “No Entry" is needed, please indicate. a) On May 2, 2019, Carp Logistics acquired 5,000 shares of common stock of Leo Transportation Corporation for $50,000 ($10/share). Fair Value Method Account Description Account Description Equity Method Debit Debit Credit Credit b) On August 15, 2019, Leo Transportation declared and paid a dividend of $4,000 to all shareholders. Carp Logistics received $800 (20% of the total dividend). Fair Value Method Equity Method Account Description Debit Credit Account Description Debit Credit c) On December 31, 2019, Leo Transportation Corporation reported net income of $80,000. (Carp's 20% share is $1,600). Equity Method Debit Fair Value Method Account Description Debit Credit Account Description Credit d) At December 31, 2019, Leo Transportation Corporation shares were trading at $9 per share and the fair value of Carp's shares was $45,000 (S9 per share x 5,000 shares) Equity Method Debit Fair Value Method Account Description Debit Account Description Credit Credit
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1 Find journal Entries in books of accounts of Corp Logistics under Fair Value Method General Jour... View the full answer
Related Book For
Governmental and Nonprofit Accounting
ISBN: 978-0132751261
10th edition
Authors: Robert Freeman, Craig Shoulders, Gregory Allison, Robert Smi
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