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Alexxandr [17]
4 years ago
12

common stock for $12,900 (Coronado does not have significant influence). During the year, Sherman paid a cash dividend of $3.25

per share. Assume the stock is nonmarketable.Prepare Coronado’s journal entries to record (a) the purchase of the investment, (b) the dividends received, and (c) the fair value adjustment. (Assume a zero balance in the Fair Value Adjustment account.)

Business
2 answers:
maria [59]4 years ago
8 0

Answer:

Following are the journal entries recorded;

Debit: Equity Investment Trading = $12,900

Credit: Cash = $12,900

(To record the purchase of the investment as trading securities)

Debit: Cash (400 × 3.25) = $1,300

Credit: Dividend Revenue = $1,300

(To record dividends received)

Debit: Fair Value Adjustment - Trading (400 × 34.50) - 12900 =  $900

Credit: unrealized Holding gain or loss - income = $900

(To record Fair Value Adjustment)

sveta [45]4 years ago
6 0

Answer:

Detailed solution is given below:

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e) 11.3%

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Answer:

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