I need help with this again. I know I have November 3rd, Dec 1, dec31 and all pa
ID: 2607787 • Letter: I
Question
I need help with this again. I know I have November 3rd, Dec 1, dec31 and all part B wrong. I can't seem to figure it out.
lest on (1) January 2, 2012, and and end of year (LO. 2, 5 Problems Paris Company acquired on July 15, 2012, 400 shares of Rome Company S720 par value stock at $698.40 per share plus a broker's commission of$1.728. On August 1, 2012. Paris C received a cash dividend of $8.64 per share. On November 3, 2012, it sold 200of the at $756 per share less a broker's commission of s1,152. On December 1,2012, Rome issued shares comprising a 100% stock dividend declared on its capital stock on Proble Prepare ent Paris Company ese shares trading s On December 31, 2012, the end of Paris Company's calendar-year accou market quotation for Rome Co stock was $331.20 considered to be temporary. mpany's common per share. The decline was a. Prepare journal entries to record all of these data assuming the sec temporary investments classified as trading securities. Where last entry appear in the financial statements? should the accounts in the held for b. Assume Rome Company has become a major customer so the share sbe shown in the onancermheth.iatio purposes. Indicate how the invesiment shotiExplanation / Answer
a.
workings:
Trading securities, net of allowance account presented in the current asset section of balance sheet.
b.
It is shown under Section: investments and using sub classification equity investment in rome company
Date Account Debit Credit Jul.15 Trading securities 2,81,088 Bank 2,81,088 [Trading securities purchased] Aug.1 Bank 3,456 Dividend income 3,456 [Dividend revenue received] Nov.3 Bank 1,50,048 Trading securities 1,40,544 Realised gain on disposal of trading securities 9,504 [Trading securities disposed] Dec.1 Trading securities 1,40,544 Trading securities 1,40,544 [Memo entry to record stock dividend] Dec.31 unrealised holding loss on trading securities 8,064 Allowance on trading securities 8,064 [Fair value adjustment]