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KatRina [158]
2 years ago
5

The summarized balance sheets of Wildhorse Company and Blossom Company as of December 31, 2021 are as follows: Wildhorse Company

Balance Sheet December 31, 2021 Assets $2850000 Liabilities $390000 Capital stock 1400000 Retained earnings 1060000 Total equities $2850000 Blossom Company Balance Sheet December 31, 2021 Assets $2160000 Liabilities $500000 Capital stock 1330000 Retained earnings 330000 Total equities $2160000 If Wildhorse Company acquired a 20% interest in Blossom Company on December 31, 2021 for $520000 and the equity method of accounting for the investment were used, the amount of the debit to Equity Investments (Blossom) would have been $432000. $266000. $520000. $332000.
Business
1 answer:
-Dominant- [34]2 years ago
4 0

Answer:

$520,000

Explanation:

Under the fair value method of accounting, the investment is recorded at cost paid to acquire such investment. So, the Debit to Equity Investments (Blossom) would have been $520,000

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1. 31 Dec

Dr Notes receivable $261,600

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Cr Interest revenue $21,619.9

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Cr Notes receivable $261,600

Explanation:

A. Preparation of the journal entry to record the transaction of December 31, 2015, for the Ed Abbey Co

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Dr Discount on notes receivable $45,401

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Dr Discount on notes receivable $23,781.1

interest revenue $23,781.1

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3 years ago
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