Weygandt, Financial & Ma Help I System Announcements (1 Unread) PRINTER VER Prob

Question

Weygandt, Financial & Ma Help I System Announcements (1 Unread) PRINTER VER Problem 12-2A In January 2017, the management of Kinzie Company concludes that it has sufficient cash t some short-term investments in debt and stock securities. During the year the following transactions occurred. Fob. 1 Mar. 1 Apr 1 July 1 Aug. 1 Sept. 1 Oct. 1 Purchased 460 shares of Muninger common stock for $24,840 Purchased 700 shares of Tatman common stock for $17,500. purchased 56 $ 1,200, 7% Yoakem bonds for $6 Received a cash dividend of $0.58 per share on the Muninger common Sold 153 shares of Muninger common stock at $64 per share. Received a $1 per share cash dividend on the Tatman common stock. Received the semiannual interest on the Yoakem bonds. 7,200. Interest is payable semiannually on April 1 and October 1. Oct. 1 Sold the Yoakem bonds for $66,200 At December 31, the fair value of the M uninger common stock was $55 per share. The fair value of the Tatman common stock was $24 per share. s and Stock Investments. (Use the T-account form.) (Round answers to 0 decimal places, a.g. lounalize the transactions and entered. Do not indent manually. Record journal entries in the order presented Bal. for the date and enter 0 for the normal balance for that account.) in the problem. If no entry is 5,275. Credi t account titles are automatically indented whe required, select "No entry for the account titles and enter O for the amounts. If the Date Account Titles and Explanation Debit Credit

Explanation / Answer

Answer 1. Journal Entry Date Particulars Dr. Amt. Cr. Amt. 1-Feb Stock Investments    24,840.00    Cash    24,840.00 (To record the purchase of Muninger Common Stock) 1-Mar Stock Investments    17,500.00    Cash    17,500.00 (To record the purchase of Tatman Common Stock) 1-Apr Debt Investments    67,200.00    Cash    67,200.00 (To record the purchase of Yoakem Bonds) 1-Jul Cash (460 Shares X $0.58)          266.80    Dividend Revenue          266.80 (To record the dividend received) 1-Aug Cash (153 shares X $64)      9,792.00     Stock Investments ($24,840 / 460 shares X 153 shares)      8,262.00     Gain on Sale of Stock Investments ($9,792 - $8,262)      1,530.00 (To record the sale of Muninger Common Stock) 1-Sep Cash (700 Shares X $1)          700.00    Dividend Revenue          700.00 (To record the dividend received) 1-Oct Cash ($67,200 X 7% X 6/12)      2,352.00    Interest Revenue      2,352.00 (To record the interest received) 1-Oct Cash    66,200.00 Loss on Sale of Debt Investment ($67,200 - $66,200)      1,000.00    Debt Investments    67,200.00 (To record the sale of Yoakem bonds) Answer 2. Stock Investments 1-Feb    24,840.00      8,262.00 1-Aug 1-Mar    17,500.00 End. Bal.    34,078.00 Debt Investments 1-Apr    67,200.00    67,200.00 1-Oct End. Bal.                   -   Answer 3. Security No. of Shares Cost Fair Value Difference Muninger Common                307.00      16,578.00      16,885.00            307.00 Tatman Common                700.00      17,500.00      16,800.00          (700.00) Total      34,078.00      33,685.00          (393.00) Journal Entry Date Particulars Dr. Amt. Cr. Amt. 31-Dec Unrealized Loss - Income      393.00 Fair Value Adjustment - Trading      393.00 (To record the fair value adjustment) Answer 4. Balance Sheet (Partial) Dec 31 Assets Current Assets Short Term Investments                33,685.00 Answer 5. Income Statement Revenue Category Dividend Revenue Other Revenues & Gains Gain on Sale of Stock Investments Other Revenues & Gains Interest Revenue Other Revenues & Gains Loss on Sale of Debt Investments Other Expenses & Losses Unrealized Loss - Income Other Expenses & Losses

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