On January 1, Lyon Corporation purchased a 25% equity investment in Shane Corpor
ID: 2392346 • Letter: O
Question
On January 1, Lyon Corporation purchased a 25% equity investment in Shane Corporation for $150,000. At December 31, Shane declared and paid a $80,000 cash dividend and reported net income of $380,000.
Journalize the transactions. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit (To record receipt of dividend) (To record revenue from investment)Explanation / Answer
1.
2.
Date Account titles and explanation Debit Credit Jan. 1 Stock Investments $150,000 Cash $150,000 Dec. 31 Cash ($80,000 * 25%) $20,000 Stock Investments $20,000 Dec. 31 Stock Investments $95,000 Revenue from Stock Investments($380,000 * 25%) $95,000