Ask Question
3 October, 19:44

Ivanhoe Company acquired 30% of the outstanding common stock of Grindelwald Inc. on January 1, 2022, by paying $1,170,000 for 39,000 shares. Grindelwald declared and paid a $1 per share cash dividend on June 30 and again on December 31, 2022. Grinwold reported net income of $520,000 for the year. (a) Prepare the journal entries for Sunland Company for 2022, assuming Sunland cannot exercise significant influence over Grinwold

+2
Answers (1)
  1. 3 October, 20:44
    0
    December 31, 2022

    Dr Available-for-Sale Securitie$1,170,000

    Cr Cash ... $1,170,000

    June 30, 2022

    Dr Cash ... $39,000

    Cr Dividend Revenue ...

    $39,000

    December 31, 2022

    Dr Cash ... $39,000

    Cr Dividend Revenue ... $39,000

    Dr Securities Fair Value Adjustment (Available-for-Sale) ... $273,000

    Cr Unrealized Holding Gain or Loss-Equity ... $273,000

    Explanation:

    Journal entries for Sunland Company for 2022

    December 31, 2022

    Dr Available-for-Sale Securitie$1,170,000

    Cr Cash ... $1,170,000

    June 30, 2022

    Dr Cash ... $39,000

    ($39,000*$1 per share)

    Cr Dividend Revenue ...

    $39,000

    December 31, 2022

    Dr Cash ... $39,000

    Cr Dividend Revenue ... $39,000

    Securities Fair Value Adjustment

    Dr (Available-for-Sale) ... $273,000

    Unrealized Holding Gain or Loss

    Cr Equity ... $273,000

    $37 X 39,000 = $1,443,000

    $1,443,000 - $1,170,000 = $273,000
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Ivanhoe Company acquired 30% of the outstanding common stock of Grindelwald Inc. on January 1, 2022, by paying $1,170,000 for 39,000 ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers