Balance sheet for the investment in flimsy

Reference no: EM13915836

On January 1, 2014, Flip Company purchased 10,000 shares of the stock of Flimsy, and did obtain significant influence. The investment is intended as a long-term investment. The stock was purchased for $90,000, and represents a 30% ownership stake. Flimsy made $25,000 of net income in 2014, and paid dividends of $10,000. The price of Flimsy's stock increased from $10 per share at the beginning of the year, to $12 per share at the end of the year.

Requirements:

a. Prepare the January 1 & December 31 general journal entries for Flip Company.

b. How much should the Flip Company report on the balance sheet for the investment in Flimsy as the end of 2014

Reference no: EM13915836

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