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E17.14 (LO 2) (Equity Investment) Oregon Co. had purchased 200 shares of Washington Co. for $40...

E17.14 (LO 2) (Equity Investment) Oregon Co. had purchased 200 shares of Washington Co. for $40 each this year (Oregon Co. does not have signifi cant infl uence). Oregon Co. sold 100 shares of Washington Co. stock for $45 each. At year-end, the price per share of the Washington Co. stock had dropped to $35. Instructions Prepare the journal entries for these transactions and any year-end adjustments.

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Answer #1

S.No.

Journal

Amount ($)

Amount ($)

Investment in equity- Washington (200*40)

8000

         Cash

8000

(To record the share purchase)

Cash (100*45)

4500

       Gain on sale of investment in equity-Washington

        (Bal)

500

       Investment in equity- Washington (100*40)

4000

(To record sale)

Unrealized loss (200-100)*(40-35)

500

      Investment in equity-Washington

500

(To record year end adjustment)
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