As a long-term investment, Painters' Equipment Company purchased 20% of AMC Supplies Incorporated's 430,000 shares for $510,000 at the beginning of the fiscal year of both companies. On the purchase date, the fair value and book value of AMC's net assets were equal. During the year, AMC earned net income of $280,000 and distributed cash dividends of 15 cents per share. At year-end, the fair value of the shares is $538,000. Required: 1. Assume no significant influence was acquired. Prepare the appropriate journal entries from the purchase through the end of the year. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. View transaction list Journal entry worksheet 23 Record the purchase of AMC Supplies shares for $510,000 as a long-term investment. Note: Enter debits before credits Transactions General Journal Debit Credit
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- As a long-term investment, Painters' Equipment Company purchased 20% of AMC Supplies Incorporated's 470,000 shares for $550,000 at the beginning of the fiscal year of both companies. On the purchase date, the fair value and book value of AMC’s net assets were equal. During the year, AMC earned net income of $320,000 and distributed cash dividends of 20 cents per share. At year-end, the fair value of the shares is $582,000. Assume significant influence was acquired. Prepare the appropriate journal entries from the purchase through the end of the year. 1. Record the purchase of AMC Supplies shares for $550,000 as a long-term investment. 2. Record Painters' Equipment's share of AMC Supplies' $320,000 net income. 3. Record the cash dividend of 20 cents per share. 4. Record any necessary year-end adjusting journal entry when the fair value of the shares held are $582,000 at year-end.As a long-term investment, Painters’ Equipment Company purchased 20% of AMC Supplies Inc.’s 400,000 shares for $480,000 at the beginning of the fiscal year of both companies. On the purchase date, the fair value and book value of AMC’s net assets were equal. During the year, AMC earned net income of $250,000 and distributed cash dividends of 25 cents per share. At year-end, the fair value of the shares is $505,000. Required: 1. Assume no significant influence was acquired. Prepare the appropriate journal entries from the purchase through the end of the year. 2. Assume significant influence was acquired. Prepare the appropriate journal entries from the purchase through the end of the year.As a long-term investment, Painters' Equipment Company purchased 20% of AMC Supplies Incorporated's 470,000 shares for $550,000 at the beginning of the fiscal year of both companies. On the purchase date, the fair value and book value of AMC’s net assets were equal. During the year, AMC earned net income of $320,000 and distributed cash dividends of 20 cents per share. At year-end, the fair value of the shares is $582,000. 1. Assume no significant influence was acquired. Prepare the appropriate journal entries from the purchase through the end of the year. Record the purchase of AMC Supplies shares for $550,000 as a long-term investment. Record Painters' Equipment's share of AMC Supplies' $320,000 net income. Record the cash dividend of 20 cents per share. Record any necessary year-end adjusting journal entry when the fair value of the shares held are $582,000.
- As a long-term investment, Painters' Equipment Company purchased 20% of AMC Supplies Inc.'s 510,000 shares for $590,000 at the beginning of the fiscal year of both companies. On the purchase date, the fair value and book value of AMC’s net assets were equal. During the year, AMC earned net income of $360,000 and distributed cash dividends of 30 cents per share. At year-end, the fair value of the shares is $626,000. Record Painters' Equipment's share of AMC Supplies' $360,000 net income. Record the cash dividend of 30 cents per share. Record any necessary year-end adjusting journal entry when the fair value of the shares held are $626,000 at year-end.As a long-term investment, Fair Company purchased 20% of Midlin Company’s 120,000 shares for $144,000 at the beginning of the reporting year of both companies. During the year, Midlin earned net income of $117,000 and distributed cash dividends of $0.30 per share. At year-end, the fair value of the shares is $150,000. Required: 1. Assume no significant influence was acquired. Record the transactions from the purchase through the end of the year, including any adjustment for the investment’s fair value, if appropriate.As a long-term investment, Painters’ Equipment Company purchased 20% of AMC Supplies Ltd’s 400,000 shares for OMR480,000 at the beginning of the financial year of both companies. On the purchase date, the fair value and the book value of AMC’s net assets were equal. During the year, AMC earned net income of OMR250,000 and distributed cash dividends of OMR0.250 per share. At year-end, the fair value of the shares is OMR505,000. Required: 1.Assume no significant influence was acquired. Prepare the appropriate journal entries from the purchase through the end of the year. (Cost Method) 2.Assume significant influence was acquired. Re-enact the appropriate journal entries from the purchase through the end of the year to report the investment balance in the consolidated financial statements of Painters’ Equipment Company. (Equity Method)
- As a long-term investment at the beginning of the current fiscal year, Company A purchased 30% of Company B's 20 million shares for $60 million. The fair value and book value of the shares were the same at that time. During the year, Company B earned net income of $70 million and distributed cash dividends of $2.00 per share. At the end of the year, the fair value of the shares is $56 million. Required: Prepare the appropriate journal entries from the purchase through the end of the year. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions, (i.e., 10,000,000 should be entered as 10). View transaction list Journal entry worksheet < 1 2 3 Record the investor's share of net income. Note: Enter debits before credits. Transactions 2 General Journal Debit Credit Investment in equity affiliate 21 Retained earnings 21 Record entry Clear entry View general journal[The following information applies to the questions displayed below.]As a long-term investment, Painters' Equipment Company purchased 20% of AMC Supplies Inc.'s 520,000 shares for $600,000 at the beginning of the fiscal year of both companies. On the purchase date, the fair value and book value of AMC’s net assets were equal. During the year, AMC earned net income of $370,000 and distributed cash dividends of 25 cents per share. At year-end, the fair value of the shares is $637,000. Required:1. Assume no significant influence was acquired. Prepare the appropriate journal entries from the purchase through the end of the year. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) a)Record the purchase of AMC Supplies shares for $600,000 as a long-term investment. b)Record Painters' Equipment's share of AMC Supplies' $370,000 net income. c) Record the cash dividend of 25 cents per share. d)Record any necessary year-end…As a long-term investment at the beginning of the 2021 fiscal year, Florists International purchased 20% of Nursery Supplies Inc.'s 10 million shares for $70 million. The fair value and book value of the shares were the same at that time. During the year, Nursery Supplies earned net income of $45 million and distributed cash dividends of $1.00 per share. At the end of the year, the fair value of the shares is $66 million. Required:Prepare the appropriate journal entries from the purchase through the end of the year. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions, (i.e., 10,000,000 should be entered as 10).) 1. Record the investment in Nursery Supplies shares. 2.Record the investor's share of net income. 3. Record the cash dividends received from Nursery Supplies shares. 4.Record fair value adjustment at year-end.
- As a long-term investment at the beginning of the 2021 fiscal year, Florists International purchased 30% of Nursery Supplies Inc.’s 8 million shares for $56 million. The fair value and book value of the shares were the same at that time. During the year, Nursery Supplies earned net income of $40 million and distributed cash dividends of $1.25 per share. At the end of the year, the fair value of the shares is $52 million.Required:Prepare the appropriate journal entries from the purchase through the end of the year.As a long-term investment at the beginning of the 2021 fiscal year, Florists International purchased 25% of Nursery Supplies Inc.'s 16 million shares for $74 million. The fair value and book value of the shares were the same at that time. During the year, Nursery Supplies earned net income of $32 million and distributed cash dividends of $1.50 per share. At the end of the year, the fair value of the shares is $70 million. Required:Prepare the appropriate journal entries from the purchase through the end of the year. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions, (i.e., 10,000,000 should be entered as 10).)Conroy Financial paid $530,000 for a 20% investment in the common stock ofMaverick, Inc. For the first year, Maverick reported net income of $270,000, and at year-enddeclared and paid cash dividends of $115,000. On the balance-sheet date, the fair value of Conroy’s investment in Maverick stock was $410,000.Requirements1. Which method is appropriate for Conroy to use in its accounting for its investment inMaverick? Why?2. Show everything that Conroy would report for the investment and any investment revenuein its year-end financial statements.