|
|
|
|
|
1. Journal Entries:
By using Cost method:
Particulars | Debit | Credit |
Investment in stocks of beanery coffee Inc. | 15,000 | |
Cash | 15,000 | |
(Being shares purchased) | ||
Cash | 7,500 | |
Dividend Income | 7,500 | |
(Being dividend received) |
2. Journal entries:
By using equity method:
Investment in stocks of beanery coffee Inc. = 50,000 * 30% = $15,000
Investment in stocks of beanery coffee Inc. = 25,000 * 30% = $7,500
Particulars | Debit | Credit |
Investment in stocks of beanery coffee Inc. | 15,000 | |
Cash | 15,000 | |
(Being shares purchased) | ||
Investment in stocks of beanery coffee Inc. | 15,000 | |
Income from Investment in beanery company | 15,000 | |
(Being income earned) | ||
Cash | 7,500 | |
Investment in stocks of beanery coffee Inc. | 7,500 | |
(Being dividend received) |
3. Investment would be classified as a Long term investment in balance sheet of cookie & coffee creations Inc.
4. Investment amount appears on the balance sheet under:
Cost method = Cost of acquisition
= $15,000
Therefore, Investment amount appear on the balance sheet under cost method = $15,000.
Investment amount appears on the balance sheet under:
Equity method = Cost of acquisition + income received - Dividend received
= 15,000 + 15,000 - 7,500
= $22,500
Therefore, Investment amount appear on the balance sheet under Equity method = $22,500
Natalie has been approached by Ken Thornton, a shareholder of The Beanery Coffee Inc. Ken wants...
Natalie has been approached by Ken Thornton, a shareholder of The Beanery Coffee Inc. Ken wants to retire and would like to sell his 1,000 shares which represents 30% of all shares issued. The Beanery is currently operated by Ken's twin daughters, who each own 35% of the common shares. The Beanery not only operates a coffee shop but also roasts and sells beans to retailers, under the name "Rocky Mountain Beanery.' The Beanery Coffee, The business has been operating...
Question 2 Natalie has been approached by Ken Thornton, a shareholder of The Deanery Coffee Ine, ker wants to retire and would like to sell is 1,000 shares in The Beanery Coffee, which represents 30% of all shares issued. The Beanery is currently operated by Ken's twin daughters, who each own 35% of the common shares. The Beangry not only operates a coffee shop but also rests and set beans to retailers, under the name "Rocky Mountain Banery." The business...
Question 1 Natalie's friend, Curtis Lesperance, decides to meet with Natalie after hearing that her discussions about a possible business partnership with her friend Katy Peterson have failed. (Natalie had decided that forming a partnership with Katy, a high school friend, would hurt their friendship. Natalie had also concluded that she and Katy were not compatible to operate a business venture together.) Because Natalie has been so successful with Continuing Cookie Chronicle and Curtis has been just as successful with...
This is all one question. Please I need your help for today.
Please..
Cookle Creations 13 Natalie's friend, Curtis Lesperance, decides to meet with Natalie after hearing that her discussions about a possible business partnership with her friend Katy Peterson have failed. (Natalie had decided that forming a partnership with Katy, a high school friend, would hurt their friendship. Natalie had also concluded that she and Katy were not compatible to operate a business venture together.) Because Natalie has been...
Natalie and her friend Curtis Lesperance decide that they can benefit from joining Cookie Creations and Curtis's coffee shop. In this part of the problem, they want your help in preparing financial information following the first year of operations of their new business, Cookie & Coffee Creations. After establishing their company's fiscal year-end to be October 31, Natalie and Curtis begin operating Cookie & Coffee Creations Inc. on November 1, 2019. On that date, after the issuance of shares, the...
After establishing their company's fiscal year-end to be October 31, Natalie and Curtis begin operating Cookie & Coffee Creations Inc. on November 1, 2020. On that date, after the issuance of shares, the paid-in capital section of the company's balance sheet is as follows. Paid-in capital Preferred stock, $0.50 noncumulative, no par value, 10,000 shares authorized, 2,000 issued Common stock, no par value, 100,000 shares authorized, 25,930 issued $10,000 25,930 Cookie & Coffee Creations then has the following selected transactions...
Question 18 --/1 View Policies Current Attempt in Progress After establishing their company's fiscal year-end to be October 31, Natalie and Curtis begin operating Cookie & Coffee Creations Inc. on November 1, 2020. On that date, after the issuance of shares, the paid-in capital section of the company's balance sheet is as follows. Paid-in capital Preferred stock, $0.50 noncumulative, no par value, 10,000 shares authorized, 2,000 issued Common stock, no par value, 100,000 shares authorized, 25,930 issued $10,000 25,930 Cookie...
After establishing their company's fiscal year-end to be October 31, Natalie and Curtis begin operating Cookie & Coffee Creations Inc. on November 1, 2020. On that date, after the issuance of shares, the paid-in capital section of the company's balance sheet is as follows. Paid-in capital Preferred stock, s0.50 noncumulative, no par value. 10,000 shares authorized, 2,000 issued $10,000 Common stock, no par value, 100,000 shares authorized, 25,930 issued 25,930 Cookie & Coffee Creations then has the following selected transactions...
Natalie has prepared the balance sheet and income statement of Cookie & Coffee Creations Inc. for the first year of operations, but does not understand how to prepare the cash flow statement. The income statement and balance sheet appear below. Recall that the company started operations on November 1, 2018, so all of the opening balances are zero. Additional information: 1. The company bought kitchen equipment (a commercial oven) for $29,000 on November 1, 2018, and signed a $12,000 note...
Question 2 After establishing their company's fiscal year-end to be October 31, Natalie and Curtis begin operating Cookie & Coffee Creations Inc. on November 1, 2020. On that date, after the issuance of shares, the paid-in capital section of the company's balance sheet is as follows. Paid-in capital Preferred stock, $0.50 noncumulative, no par value, 10,000 shares authorized, 2,000 issued Common stock, no par value, 100,000 shares authorized, 25,930 issued $10,000 25,930 Cookie & Coffee Creations then has the following...