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PROBLEM 12-2B (Continued)
(b) Dec. 31 Unrealized Loss—Income ........................ 2,020
Security
Cost
Fair Value
Day common
Eldridge common
$12,320
20,300
$32,620
$13,200
17,400
$30,600
(200 X $66)
(600 X $29)
(c) Current assets
(d)
Income Statement Account
Category
Dividend Revenue
Other revenues and gains
Gain on Sale of Stock Investments
Other revenues and gains
Interest Revenue
Other revenues and gains
Gain on Sale of Debt Investments
Other revenues and gains
Unrealized Loss—Income
Other expenses and losses
PROBLEM 12-3B
(a) 2016
Sept. 1 Cash (1,500 X $7) ..................................... 10,500
Oct. 1 Cash (600 X $30) ...................................... 18,000
Nov. 1 Cash (3,000 X $1) ..................................... 3,000
Dec. 15 Cash (3,400 X $.50) .................................. 1,700
31 Cash (3,500 X $1) ..................................... 3,500
Stock Investments
2016
Jan. 1 Balance 190,000
2016
Sept. 1 9,000
Oct. 1 15,000
2016
Dec. 31 Balance 166,000
PROBLEM 12-3B (Continued)
(b) Dec. 31 Unrealized Gain or Loss—Equity
Security
Cost
Fair Value
Woolridge Co. common
Coria Co. common
Sterling Motors Co. common
$ 85,000
21,000
60,000
$166,000
$ 78,200
24,500
57,000
$159,700
(3,400 X $23)
(3,500 X $7)
(3,000 X $19)
(c) Investments
Investments in stock of less than
Stockholders’ equity
Common stock .................................... $2,000,000
PROBLEM 12-4B
(a) 2015
Jan. 1 Stock Investments ............................ 1,100,000
June 30 Cash .................................................. 20,000
Dividend Revenue
Dec. 31 Cash .................................................. 20,000
31 Fair Value Adjustment—
Available-for-Sale ......................... 100,000
(b) 2015
Jan. 1 Stock Investments ............................ 1,100,000
June 30 Cash .................................................. 20,000
Dec. 31 Cash .................................................. 20,000
31 Stock Investments ............................ 120,000
PROBLEM 12-4B (Continued)
(c)
Cost Method
Equity
Method
Stock Investments
Unrealized gain—equity
Dividend revenue
Revenue from stock investments
**$30 X 40,000 shares
**$1,100,000 + $120,000 – $40,000
$1,200,000*
100,000
40,000
0
$1,180,000**
0
0
120,000
PROBLEM 12-5B
(a) Jan. 7 Cash (700 X $55) ......................................... 38,500
10 Stock Investments ...................................... 23,400
26 Cash ............................................................. 1,035
Feb. 2 Cash ............................................................. 320
10 Cash ($26 X 800) ......................................... 20,800
July 1 Cash ............................................................. 900
Dividend Revenue
Sept. 1 Stock Investments ...................................... 60,000
Dec. 15 Cash ............................................................. 1,650
(b)
Stock Investments
1/1 Bal. 99,400
1/7 35,000
1/10 23,400
2/10 22,400
9/1 60,000
12/31 Bal. 125,400
PROBLEM 12-5B (Continued)
(c) Dec. 31 Unrealized Gain or Loss—Equity ................... 3,000
Security
Cost
Fair Value
Robison Corporation Common
Younker Corporation Common
$ 42,000
83,400
$125,400
$ 43,200
79,200
$122,400
(900 X $48)
(1,100 X $72)
(d) Investments
Investments in stock of less than 20% owned
Stockholders’ equity
Total paid-in capital and retained earnings ................... xxxxx
Less: Unrealized loss on available- for-sale
PROBLEM 12-6B
MUSSATTO CORPORATION
Balance Sheet
December 31, 2015
Assets
Current assets
Cash ..................................................................... $ 210,000
Short-term investments, at fair value ................. 280,000
Investments
Property, plant, and equipment
Intangibles
PROBLEM 12-6B (Continued)
MUSSATTO CORPORATION
Balance Sheet (Continued)
December 31, 2015
Liabilities and Stockholders’ Equity
Current liabilities
Notes payable ..................................................................... $ 110,000
Accounts payable ............................................................... 375,000
Stockholders’ equity
Paid-in capital
Common stock, $5 par value,
*PROBLEM 12-7B
(a)
Dec. 31
Stock Investments
710,000
Current Assets
710,000
(b)
PATEL COMPANY AND SUBSIDIARY
Worksheet—Consolidated Balance Sheet
December 31, 2015
Patel
Company
Singh
Company
Eliminations
Consolidated
Data
Assets
Dr.
Cr.
Current assets
768,000
379,000
1,147,000
Investment in
Singh Company
Common stock
710,000
710,000
0
Plant and equipment
(net)
1,882,000
351,000
20,000
2,253,000
Excess of cost over
book value of
subsidiary
50,000
50,000
Totals
3,360,000
730,000
3,450,000
Liabilities and
Stockholders’ Equity
Current liabilities
870,000
90,000
960,000
Common stock—
Patel Company
1,947,000
1,947,000
Common stock—
Singh Company
360,000
360,000
0
Retained earnings—
Patel Company
543,000
543,000
Retained earnings—
Singh Company
280,000
280,000
0
Totals
3,360,000
730,000
710,000
710,000
3,450,000
