Please make it typed. P12-3A Journalize transactions and adjusting entry for sto
ID: 2522067 • Letter: P
Question
Please make it typed.
P12-3A Journalize transactions and adjusting entry for stock investments. On December 31, 2015, Turnball Associates owned the following securities, held as a long-term investment. The securities are not held for influence or control of the investee. Common Stock Shares Cost Gehring Co. 2,000 $60,000 Wooderson Co. 5,000 45,000 Kitselton Co. 1,500 30,000 On December 31, 2015, the total fair value of the securities was equal to its cost. In 2016, the following transactions occurred. July 1 Received $1 per share semiannual cash dividend on Wooderson Co. common stock. Aug. 1 Received $0.50 per share cash dividend on Gehring Co. common stock. Sept. 1 Sold 1,500 shares of Wooderson Co, common stock for cash at $8 per share. Oct. 1 Sold 800 shares of Gehring Co. common stock for cash at $33 per share. Nov. 1 Received $1 per share cash dividend on Kitselton Co. common stock. Dec. 15 Received $0.50 per share cash dividend on Gehring Co. common stock. Dec 31 Received $1 per share semiannual cash dividend on Wooderson Co. common stock. At December 31, the fair values per share of the common stocks were Gehring Co. $32, Wooderson Co. $8, and Kitselton Co. $18. Instructions (a) Journalize the 2016 transactions and post to the account Stock Investments. (Post in T-account form.) (b) Prepare the adjusting entry at December 31, 2016, to show the securities at fair value. The stock should be classified as available-for-sale securities. (c ) Show the balance sheet presentation of the investment-related accounts at December 31, 2016. At this date, Turnball Associates has common stock $1,500,000 and retained earnings $1,000,000. NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?" . (a) 2016 July 1 Account Value Account Value Aug 1 Account Value Account Value Sept. 1 Account Value Account Value Account Value Oct.1 Account Value Account Value Account Value Nov. 1 Account Value Account Value Dec. 15 Account Value Account Value Dec. 31 Account Value Account Value Stock Investments 2016 2016 Jan. 1 Balance Value Sept. 1 Value Oct. 1 Value 2016 Dec. 31 Balance Value (b) Dec.31 Account Value Account Value Security Cost Fair Value Gehring Co. Value Value Wooderson Co. Value Value Kitselton Co. Value Value ? ? (c) Investments Investments in stock of less than 20% owned companies, at fair value Value Stockholders' equity Common stock Value Retained earnings Value Total paid-in capital and retained earnings ? Less: Unrealized loss on available-for-sale securities Value Total stockholders' equity ? After you have completed P12-3A, consider the additional question. 1. Assume that number of shares of Wooderson Co. sold changed to 2,000 shares. Show impact on the journal entries and presentation in balance sheet.Please make it typed.
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A B C D E=D-C F G=A-F G*E C*G D*G Working-1 Shares Cost Per Share Fair Value Adjustment Sold Share Remaining Share Adjustment Value Cost of Remaining Share Fair Value of Remainig Sahre Gehring Co 2000 60000 30 32 2 800 1200 2400 36000 38400 Wooderson Co 5000 45000 9 8 -1 1500 3500 -3500 31500 28000 Kitselton Co 1500 30000 20 18 -2 0 1500 -3000 30000 27000 Total -4100 97500 93400 a. Journal Entries Date Account Debit Credit July 1 2016 Cash (5000*1) 5000 Dividend Revenue 5000 (being recorded cash dividend on Wooderson Co. common stock) Aug 1 2016 Cash (2000*0.5) 1000 Dividend Revenue 1000 (being recorded cash dividend on Gehring Co. common stock.) Sept 1 2016 Cash (1500*8) 12000 Loss on sale of available-for-sale securities 1500*(9-8) 1500 Stock Investment (1500*9) From working-1 13500 (sale of wooderson co 1500 shares at loss of $1) Oct 1 2016 Cash (800*33) 26400 Gain on sale of available-for-sale securities 800*(33-30) 2400 Stock Investment (800*30) From working-1 24000 (sale of gehring co 800 shares at profit of $3) Nov 1 2016 Cash (1500*1) 1500 Dividend Revenue 1500 (being recorded cash dividend on Kitselton Co. common stock.) Dec 15 2016 Cash (2000-800)-*0.5 600 Dividend Revenue 600 (being recorded cash dividend on Gehring Co. common stock.) Dec 31 2016 Cash (5000-1500)*1 3500 Dividend Revenue 3500 (being recorded cash dividend on Wooderson Co. common stock) b. Adjusting Entry Dec 31 2016 Securities Fair Value adjustment-Available for sale securities 4100 Stock Investment (workin-1) 4100 (Stock adjusted to Fair Value) c. Balance Sheet Investment in stock of less than 20% owned copanies at fair value 93400 Stockholder Equity: Common Stock 1500000 Retained Earning 1000000 Total Paid in capital and retained earning 2500000 Less: Fair Value Adjustment 4100 Total Stock Holder Equity 2495900