1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Dominik [7]
3 years ago
5

On January 1, 2018, Jolley Corp. paid $250,000 for 25% of the voting common stock of Tige Co. On that date, the book value of Ti

ge was $850,000. A building with a carrying value of $160,000 was actually worth $220,000. The building had a remaining life of twenty years. Tige owned a trademark valued at $90,000 over cost that was to be amortized over 20 years. During 2018, Tige sold to Jolley inventory costing $60,000, at a markup of 50% on cost. At the end of the year, Jolley still owned some of these goods with an intra-entity selling price of $33,000. Tige reported net income of $200,000 during 2018. This amount included a extraordinary gain of $35,000. Tige paid dividends totaling $40,000.
Required:

Prepare all of Jolley's journal entries for 2013 in relation to Tige Co. Assume the equity method is appropriate for use.
Business
1 answer:
shusha [124]3 years ago
4 0

Answer:

            Dr. Investments in Associates 250,000

            Cr.            Cash                                 500,000

          Dr. Cash                                   10,000

          Cr.            Investments in Associates 10,000

          Dr. Investments in Associates 50,000

          Cr.     Investment revenue                    50,000

Explanation:

The equity method is a type of accounting used to incorporate investments. It is used when the investor holds significant influence over the investee but does not exercise full control over it.

An investor is deemed to have significant influence over an investee if it owns between 20% to 50% of the investee’s shares or voting rights.

- Jolley receives dividends of $10,000, which is 25% of $40,000, and records a reduction in their investment account. The reason for this is that they have received money from their investee.

- Jolley records the net income from Tige Co. as an increase to its Investment account.

You might be interested in
All of the following are expenses associated with home ownership that should be planned for early in the process except
grandymaker [24]
Mortgage payments are expenses associated with home ownership
7 0
3 years ago
George, a chef and owner of a popular restaurant, is always visiting his competition to observe how they are doing things in the
Vedmedyk [2.9K]

George is utilizing competitive intelligence. This is a strategy in which the individual made use of gathering, defining and as well as analyzing their customers, competitors or products by means of helping improve his or her own business and to make strategic decisions that would be best for one’s business or company.

7 0
3 years ago
What benefit does a 401(k) plan provide over an IRA?
svetoff [14.1K]
Hello,

Your brainliest answer would be:

A benefit of 401k It is Less of investment risk.

Plz mark me brainliest!

Hope this helps!
5 0
3 years ago
Read 2 more answers
ne of the most important financial management activities that a firm undertakes is its evaluation and allocation of investment f
natulia [17]

Answer:

This statement is True

3 0
3 years ago
Qué importancia tiene llevar contabilidad para las empresas en El Salvador? ayuda porfavorrr​
miv72 [106K]
La importancia de la contabilidad radica en que, sin ella, no sabrías cuánto dinero entra y sale de tu organización ni podrías planear para el crecimiento futuro
7 0
3 years ago
Other questions:
  • The belief that successful performance will result in some outcome(s) is known as:
    7·1 answer
  • In considering the decision to adopt a dog, indicate which of the following is an example of a private cost, a private benefit,
    15·2 answers
  • Chemical labels must contain a product identifier, signal word and a pictogram to represent the hazards. What other information
    15·2 answers
  • A portfolio manager generates a 10% rate of return on a "small cap" portfolio, compared to an 8% rate of return on the benchmark
    5·1 answer
  • Which of the following is NOT the quantity theory of money
    13·2 answers
  • Modern Federal Bank is setting up a brand-new branch. The cost of the project will be $1.2 million. The branch will create addit
    15·1 answer
  • A manufacturing department has 50,000 EUP for units completed and transferred out and 4,500 EUP for units in ending inventory. M
    11·1 answer
  • Markel how your day it good
    8·1 answer
  • Laura works for a company that sells luxury cars. Laura approaches a customer by offering the keys to a customer and encouraging
    10·1 answer
  • Six-packs of soda, cartons of eggs, and three-packs of paper towels are all examples of products sold using what kind of pricing
    8·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!