Question: Please solve. Urgent It is year the White Caps Ltd.'s first year of operations. White Caps Ltd. had the following transactions regarding their investments May

 Please solve. Urgent It is year the White Caps Ltd.'s first
year of operations. White Caps Ltd. had the following transactions regarding their
Please solve. Urgent

It is year the White Caps Ltd.'s first year of operations. White Caps Ltd. had the following transactions regarding their investments May 1Purchased 600 Jerry Co. common shares for $180 per share. This investment is classified as held for trading, June 1 Purchased 1,000 bonds of Larry Inc at $300 each. These bonds pay interest at a rate of 6%, paid semi-annually on November 30 and May 31. These bonds were also purchased for trading purposes. July 1 Purchased 4.000 Barry Ltd. common shares for $210 per share. These shares represent 25% of the issued common shares of Barry Itd. Because of this investment, the directors of Barry Ltd. invited a White Caps Ltd. executive to sit on their board. Sept. 1 Received a $3-per-share cash dividend from Barry Ltd. Nov. 1 Sold 200 Jerry Co. common shares for $189 per share. 30 Interest on the Larry Inc. bonds was received. Dec. 15 A $0.50-per-share cash dividend on Jerry Co. common shares was received 31 As of this date the following fair values and net income information was identified: $165 per Jerry Co. share 5219 per Barry Ltd. share $303 per Larry Inc bond Barry Ltd, reported net income for the year ended December 31 Year 1 of $300,000 White Caps Ltd. uses the FVTPL (fair value through profit or loss method) when accounting for non-strategic investments, and the equity method when accounting for strategic investments. Instructions (a) Record the above transactions for the dates May 1 to Dec 15. (10 marks) (b) Prepare all necessary adjusting entries on December 31st Year 1 required to report the investments at their appropriate value and any accrued investment revenue

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!