User Account

All Pages

Sanborn''s balance sheet as held to maturity securities

Assignment Help Accounting Basics
Reference no: EM13881632

1.On January 2, 2013, Sanborn Tobacco, Inc., bought 5% of Jackson Industry's capital stock for $90 million as a temporary investment. Sanborn realized that these securities normally would be classified as available for sale, but elected the fair value option to account for the investment. Jackson Industry's net income for the year ended December 31, 2013, was $120 million. The fair value of the shares held by Sanborn was $98 million at December 31, 2013. During 2013, Jackson declared a dividend of $60 million.

Required:
1. Would this investment be classified on Sanborn's balance sheet as held to maturity securities, trading securities, available for sale securities, significant influence investments, or other? Explain.
2. Prepare all appropriate journal entries related to the investment during 2013.
3. Indicate the effect of this investment on 2013 income before taxes.

Reference no: EM13881632

Questions Cloud

The appropriate reporting category for this investment : December 31, 2013, and December 31, 2014, the market value of IBM stock is $58 and $61 per share, respectively.
Maintain a constant media schedule : It is usually unnecessary or not feasible to maintain a constant media schedule all year. What are the two other alternatives and what key characteristics of these two alternatives would be taken into account?
Calculation of the percent excess air : If it is possible to do so without additional information, calculate the percent excess air supplied to the furnace: if more information is needed, state what it is and outline the calculation of the percent excess air.
Determine which strategy should be adopted at interest rate : Determine which strategy should be adopted at an interest rate of 10% per year for a 4-year planning period using the annual worth method of evaluation.
Sanborn''s balance sheet as held to maturity securities : The fair value of the shares held by Sanborn was $98 million at December 31, 2013. During 2013, Jackson declared a dividend of $60 million.
Determining the trouton rule and chen rule : Estimate the heat of vaporization of ethyl benzene at its normal boiling point using Trouton's rule and Chen's rule and compare the results with a tabulated value of this quantity. Then estimate ΔHv at 100°C using Watson's correlation.
Explain how to handle exceptions within a program : Continuing our discussion of exceptions we will work to understand various debugging and exception handling techniques. Please respond to all of the following prompts: -- Explain how to handle exceptions within a program, and provide an example using..
Method of getting around the old regulation : Coal containing 5.0 wt% S is burned at a rate of 1250lbm/mm in a boiler furnace. All of the sulfur in the coal is oxidized to SO2. The product gas is sent to a scrubber in which most of the SO2 is removed, and the scrubbed gas then passes out of a..
Explains to your friend about excitatory neurotransmitters : Write an essay that explains to your friend about excitatory neurotransmitters. Provide a detailed description of the functions associated with acetylcholine versus dopamine that could help differentiate which neurotransmitter is involved

Reviews

Write a Review

Accounting Basics Questions & Answers

  Baker is a cashier who in the last week processed 15

explain how each of the following three conditions could be a red flag for a register disbursement scheme.1. able a

  Bay company acquires 60 8 5 year 1000 community bonds on

bay company acquires 60 8 5 year 1000 community bonds on january 1 2014 for 60000.if bay sells all of its community

  Management intention to make the purchase is sufficient

Management's intention to make the purchase is sufficient.

  If the transaction is with a consolidated affiliate it

if the transaction is with a consolidated affiliate it must be eliminated from the consolidated statements. does it

  Statements regarding the taxation of c corporation

Which of the following statements is correct regarding the taxation of C corporation?

  Price-usage and total variance

If I were to make muffins and the blueberries for the muffins cost 2.05 per bag and I use 11 blueberries per muffin but then found out that people liked 15 berries per muffin and I found a store that sold 400 berries per bag at 1.89 per bag. How d..

  How is average collection period computed

How is accounts receivable turnover computed? How is average collection period computed?

  As the result of a comprehensive analysis it is determined

on january 1 2010 the balance in tabor co.s allowance for bad debts account was 13085. during the first 11 months of

  Season tickets for the longhorns are priced at 230 and

season tickets for the longhorns are priced at 230 and include 20 games. revenue is recognized after each game is

  An analysis of similar products on the market suggests a

a new product is being designed by an engineering team at golem security. several managers and employees from the cost

  Generally accepted reporting standards

Based on the definition of auditing and the four generally accepted reporting standards as well as the text discussion of these items, do you think users of financial statements should expect those statements should expect those statements to be f..

  What is the liability for compensated balances

The company's December 31, 2009 unadjusted balance of liability for compensated absences was $30,000. The company estimated 200 vacation days available and employees earned $150 per day. What is the liability for compensated balances on December 3..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd