Question

Equity investments: 20%-50% ownership On January 2, 2014, Whitworth Company acquired 40% of the outstanding stock of Aloof Company for $340,000. For the year ended December 31, 20Y4, Aloof Company earned income of $180,000 and paid dividends of $10,000. On January 31 2095, Whitworth Company sold all of its investment in Aloof Company stock for $405,000. Journalize the entries for Whitworth Company for the purchase of the stock, the share of Aloof income, the dividends received from Aloof Company, and the sale of the Aloof Company stock. If an amount box does not require an entry, leave it blank. Jan. 2, 2014 - Purchase Investment in Aloof Company Stock 340,000 Cash 340,000 Dec. 31, 20Y4 - Income Investment in Aloof Company Stock 72,000 ✓ Income of Aloof Company 72,000 4,000 ✓ Dec. 31, 2014 - Dividends Cash Income of Aloof Company X 4,000 Jan. 31, 2045 - Sale Cash 340,000 X Gain on Sale of Aloof Company Stock X 65,000 X Investment in Aloof Company Stock 405,000 х

Answer 1

Jona, dovy Investment in Aloof company Stock Cash $ 340,000 $ 340,000 ce Dec 31,2014 - Income Investment in Aloof Company Stock Income of Aloof Canpeny [180,000 (x) 40: $72,000 $ 72,000 (C cou Dividend Cash Investment in Aloof Company Stock [10,000 X 40% ] $ 4000 & 4ooo ce

• Jan 31,2045 Sale Cash loss on sale of Aloof Company stoac (Bt) Investment in Aloof compony Stock (340,000 + 72000-4000) $ 40 sooo & 3000 Yolvo