Journal entries necessary to account for sonny investment

Reference no: EM13150476

Fredo, Inc purchased 10% of Sonny Enterprises for $1,000,000 on January 1, 2011. Sonny recognized a total of $400,000 of income during 2011, paid $30,000 of dividends to Fredo during 2011, and at December 31, 2011 the market value of the Sonny investment increased to 1,040,000.

Required:

Prepare the journal entries necessary to account for the Sonny investment, assuming that Fredo accounts for that investment as (1) an available-for-sale investment, and (2) elects the fair value option.

Reference no: EM13150476

Questions Cloud

Qualifying for the medical deduction in the current year : The appraisal states that the system increased the value of Gabriel's residence by $1,000. Expenses qualifying for the medical deduction in the current year total:

Fit trends linear-exponential-quadratic-market-share data : Which trend model is best, and why? If none is satisfactory, explain. (e) Make a forecast for 2004 by using a trend model of your choice or a judgment forecast.

Compute the profit-maximizing level of price and output : If this industry acts like a monopolist in the determination of price and output, compute the profit-maximizing level of price and output

How many bags of potato chips did omar eat : How many bags of potato chips and ice cream bars did omar eat when 88 grams of fat and 1505 calories were consumed?

Journal entries necessary to account for sonny investment : Prepare the journal entries necessary to account for the Sonny investment, assuming that Fredo accounts for that investment as (1) an available-for-sale investment, and (2) elects the fair value option.

How much hcl in grams would be necessary to consume : If a single pill contains 0.150 grams of KCN How much HCl in grams would be necessary to consume all of the KCN

Expenses qualify for a medical deduction by joanne : Sierra has medical staff in residence. Disregarding the 7.5% floor, how much, if any, of these expenses qualify for a medical deduction by Joanne?

Find probability randomly selected braking distance is less : Let x be a random variable that represents a braking distance. Find the probability that a randomly selected braking distance is less than 49 meters.

How much will sulphur dioxide dissolve in water : if 0.80 g of sulfur dioxide at 10.00 atm pressure (pi) dissolves in 5.00 l of water at 25.0 degress celcius how much will sulphur dioxide dissolve in 1 l of water at 9.00 atm pressure (p2) and the same temperature?

User Account

All Pages