AC 302 Chapter 17 Problem Question 11

AC 302 Chapter 17 Problem Question 11
Name				Date		
Instructor				Course		
Intermediate Accounting 14th Edition by Kieso Weygandt and Warfield						
Primer on Using Excel in Accounting by Rex A Schildhouse						
						
P17-11 (Equity Investments—Available-for-Sale) Castleman Holdings, Inc. had the following available-for-sale investment portfolio at January 1, 2012.						
						
1,000 	shares of Evers Company at			$15.00 	per share	$15,000 
900 	shares of Rogers Company at			$20.00 	per share	$18,000 
500 	shares of Chance Company at			$9.00 	per share	$4,500 
	Available-for-sale securities at cost:					$37,500 
	Securities fair value adjustment-Available-for-sale - Credit balance					($7,500)
	Available-for-sale securities at fair value:					$30,000 
						
During 2012, the following transactions took place:						
1. On March 1, Rogers Company paid a			$2.00 	per share dividend.		
2. On April 30, Castleman Holdings, Inc. sold				300 	shares of Chance Company	
for	$11.00 	per share				
3. On May 15, Castleman Holding, Inc. purchased				100 	more shares of Evers Co. 	
stock at	$16.00 	per share				
4. At December 31, 2012, the stocks had the following price per share values:						
	Evers Company		$17.00 			
	Rogers Company		$19.00 			
	Chance Company		$8.00 			
During 2013, the following transactions took place:						
5. On February 1, Castleman Holding, Inc. sold the remaining Chance shares for						$8 
per share.						
6. On March 1, Rogers Company paid a			$2 	per share dividend.		
7. On December 21, Evers Company declared a cash dividend of					$3 	per share to be 
paid in the next month.						
8. At December 31, 2013, the stocks had the following price per share values:						
	Evers Company		$19 			
	Rogers Company		$21.00 			
						
Instructions:						
(a) Prepare journal entries for each of the above transactions.						
						
1	Mar 1, 12	Account Title			Amount	
		Dividend Revenue				Amount
						
2	Apr 30, 12	Account Title			Amount	
		Account Title				Amount
		Account Title				Amount
						
3	May 15, 12	Account Title			Amount	
		Account Title				Amount
						
4	Dec 31, 12	Account Title			Amount	
						
		Account Title				Amount
						
	Security			Cost	"Fair
Value"	"Unrealized
Gain (Loss)"
	Evers Company			Formula		
	Calculation as desired				Formula	Formula
	Rogers Company			Formula		
	Calculation as desired				Formula	Formula
	Chance Company			Formula		
	Calculation as desired				Formula	Formula
	Total of Portfolio			Formula	Formula	Formula
	Previous securities fair value adjustment  bal.—Cr.					Amount
	Securities fair value adjustment—Dr.					Formula
						
5	Feb 1, 13	Account Title			Amount	
		Account Title			Amount	
		Account Title				Amount
						
6	Mar 1, 13	Account Title			Amount	
		Account Title				Amount
						
7	Dec 21, 13	Account Title			Amount	
		Account Title				Amount
						
8	Dec 31, 13	Account Title			Amount	
						
		Account Title				Amount
						
	Security			Cost	"Fair
Value"	"Unrealized
Gain (Loss)"
	Evers Company			Formula		Formula
	Calculation as desired				Formula	Formula
	Rogers Company			Formula		Formula
	Calculation as desired				Formula	Formula
	Total of Portfolio			Formula	Formula	Formula
	Previous securities fair value adjustment  bal.—Cr.					Amount
	Securities fair value adjustment—Dr.					Formula
						
(b) Prepare a partial balance sheet showing the Investments account at December 31, 2012, and 2013.						
						
Partial Balance Sheet as of:			December 31, 2012		December 31, 2013	
Current Assets - Dividends Receivable			Amount		Amount	
Investments:						
Available-for-sale securities, at fair value			Amount		Amount	
Stockholders' equity:						
Accumulated other comprehensive gain			Amount		Amount