Prepare the journal entry to record stock, Cost Accounting

Rosco Company purchased 35,000 shares of common stock of Paxton Corporation as a long-term investment for $900,000. During the year, Paxton Corporation reported net income of $300,000 and paid dividends of $100,000.

Instructions

(a) Assuming that the 35,000 shares represent a 10% interest in Paxton Corporation:

1. Prepare the journal entry to record the investment in Paxton stock.

2. Prepare any entries that Rosco Company should make in accounting for its investment in Paxton stock during the year.

3. What is the balance of the Stock Investments account on Rosco Company's books at the end of the year?

(b) Repeat requirement (a) above except assume that the 35,000 shares represent a 20% interest in Paxton Corporation.

 

Posted Date: 3/18/2013 3:44:19 AM | Location : United States







Related Discussions:- Prepare the journal entry to record stock, Assignment Help, Ask Question on Prepare the journal entry to record stock, Get Answer, Expert's Help, Prepare the journal entry to record stock Discussions

Write discussion on Prepare the journal entry to record stock
Your posts are moderated
Related Questions
Chen Enterprises purchased 67,000 pounds (cost = $616,400) of direct material to be used in the manufacture of the company''s only product.

Imagine a world in which there are only two investment assets: Hasbro Inc. Stock (HAS) and McDonalds stock (MCD). The table below lists annual total returns (%) for each of the las

Managerial ACCT 2 Ulrich Framing is well known for the quality of its picture framing. Lucinda Ulrich, CEO, believes that the number of linear feet or framing used is the best is t

Inventory Management and Control Here the objectives of inventory management are as: 1. To ensure adequate stocks to permit for continuous production/operations, and

Determine why  JIT, TQM and AMTs may not always be entirely compatible with  the practice of standard costing.

Piece Rate System - Labour Remuneration However an employee is paid a fixed amount for all units produced irrespective of time in use; the wages payable are computed like fo


Chester & Wayne is a regional food distribution company. Mr. Chester, CEO, has asked your assistance in preparing cash-flow information for the last three months of this year. Sele

Contract Costing It is a form of exact order costing, which is applied to relatively large cost units that normally get a considerable length of time to complete as an example

Decision Making Nature of Decision-making Decision-making may fall into any type of the following categories as: 1. Short run operational decisions 2. Short run t