142 leon inc needs to account for investment transactions during 2010 jan 15purchase 4305856

142 leon inc needs to account for investment transactions during 2010 jan 15purchase 4305856

142) Leon Inc. needs to account for investment transactions during 2010:

Jan. 15Purchased 100 Bright Corporation common shares, paying $75 per share. Leon Inc. intends to hold the investment for a short period of time and has classified the investment as a short-term investment.

Jun. 30 Received a cash dividend of $1.50 per share on the Bright Corporation common shares.

Dec. 31Leon sold the Bright Corporation common shares for $8,260.

Prepare journal entries for the above transactions.

143) Sky Corporation engaged in several transactions involving a long-term investment. The equity method is used to account for this investment because Sky exercises significant influence over Lift.

a) On Jan 1, 2010  Sky Corporation purchased 2,000 common shares of Lift Corporation for $12 per share. This represents 20% ownership of Lift Corporation.

b)On March 31, 2010, Lift Corporation pays a $0.75 per share dividend to all common shareholders.

c) On December 31, 2010, the market price of Lift Corporation shares is $12.50 per share.

d) On December 31, 2010 Lift Corporation reported net income of $70,000.

Prepare journal entries for the above transactions.

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