652 Chapter 15 Investments Prepare journal entries to record the following trans
ID: 2604629 • Letter: 6
Question
652 Chapter 15 Investments Prepare journal entries to record the following transactions and events of Kodax Company. Exercise 15-12 Securities transactions2017 equity method P4 a broker's fee of and its policies will be $3,000 cash. Grecco has 90,000 shares of common stock outstanding, significantly influenced by Kodax. Grecco declared and paid a cash dividend of $1.50 per share. Grecco announced that net income for the year is $486,900. Sep. 1 Dec. 31 2018 June 1 Dec. 31 Dec. 31 Grecco declared and paid a cash dividend of $2.10 per share. Grecco announced that net income for the year is $702,750. Kodax sold 10,000 shares of Grecco for $320,000 cash.Explanation / Answer
Journal Entries
date
explanation
debit
credit
jan 2 2017
Long term investment- Greeco
411000
cash
411000
1-Sep
cash
45000
Long term investment- Greeco
45000
december 31 2015
Long term investment- Greeco
162300
earning from long term investment
162300
june1 2016
cash
63000
Long term investment- Greeco
63000
dec 31 2016
Long term investment- Greeco
234250
earning from long term investment
234250
dec 31 2016
cash
320000
gain on sale of investment
86817
Long term investment- Greeco
233183
long term investment-greeco
(234250+162300+411000-45000-63000)/3
233183.3
gain on sale of investment
699550-233183
86817
Journal Entries
date
explanation
debit
credit
jan 2 2017
Long term investment- Greeco
411000
cash
411000
1-Sep
cash
45000
Long term investment- Greeco
45000
december 31 2015
Long term investment- Greeco
162300
earning from long term investment
162300
june1 2016
cash
63000
Long term investment- Greeco
63000
dec 31 2016
Long term investment- Greeco
234250
earning from long term investment
234250
dec 31 2016
cash
320000
gain on sale of investment
86817
Long term investment- Greeco
233183
long term investment-greeco
(234250+162300+411000-45000-63000)/3
233183.3
gain on sale of investment
699550-233183
86817
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