Prepare a partial balance sheet showing the investment-related amounts to be reported at December 31, 2020 and 2021.
Prepare a partial balance sheet showing the investment-related amounts to be reported at December 31, 2020 and 2021.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Ivanhoe, Inc. had the following equity investment portfolio at January 1, 2020.
Evers Company | 960 shares @ $14 each | $13,440 | |||
Rogers Company | 880 shares @ $20 each | 17,600 | |||
Chance Company | 520 shares @ $10 each | 5,200 | |||
Equity investments @ cost | 36,240 | ||||
Fair value adjustment | (7,300 | ) | |||
Equity investments @ fair value | $28,940 |
During 2020, the following transactions took place.
1. | On March 1, Rogers Company paid a $2 per share dividend. | |
2. | On April 30, Ivanhoe, Inc. sold 320 shares of Chance Company for $11 per share. | |
3. | On May 15, Ivanhoe, Inc. purchased 100 more shares of Evers Company stock at $17 per share. | |
4. | At December 31, 2020, the stocks had the following price per share values: Evers $18, Rogers $19, and Chance $9. |
During 2021, the following transactions took place.
5. | On February 1, Ivanhoe, Inc. sold the remaining Chance shares for $9 per share. | |
6. | On March 1, Rogers Company paid a $2 per share dividend. | |
7. | On December 21, Evers Company declared a cash dividend of $3 per share to be paid in the next month. | |
8. | At December 31, 2021, the stocks had the following price per share values: Evers $20 and Rogers $21. |
Prepare a partial balance sheet showing the investment-related amounts to be reported at December 31, 2020 and 2021.
The correct number for Fair Value is 4080
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