In January 2020, the management of Wildhorse SE concludes that it has sufficient cash to permit some short-term investme

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In January 2020 The Management Of Wildhorse Se Concludes That It Has Sufficient Cash To Permit Some Short Term Investme 1 (133.48 KiB) Viewed 34 times

In January 2020, the management of Wildhorse SE concludes that it has sufficient cash to permit some short-term investments in debt and stock securities. During the year, the following transactions occurred. Feb. 1 Purchased 800 ordinary shares of Superior for €40,000. Mar. 1 Purchased 1,000 ordinary shares of Pawlik for €25,000. Apr. 1 Purchased 30 €1,100, 7% Venice bonds for €33,000. Interest is payable semiannually on October 1 and April 1. July 1 Received a cash dividend of €0.70 per share on the Superior ordinary shares. Aug. 1 Sold 266 ordinary shares of Superior at €60 per share. Sept. 1 Received a €2 per share cash dividend on the Pawlik ordinary shares. Oct. 1 Received the interest on the Venice bonds. Oct. 1 Sold the Venice bonds for €32,000. At December 31, the fair value of the Superior ordinary shares was €51 per share. The fair value of the Pawlik ordinary shares was €24 per share.
Journalize the transactions and post to the accounts Debt Investments and Share Investments. (Use the T-account form.) (Record journal entries in the order presented in the problem. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Do not leave any answer field blank. Enter O for amounts.) Date Account Titles and Explanation Debit Credit Feb. 1 Mar. 1 Apr. 1 July 1
Aug. 1 4 Sept. 1 4 Oct. 1 (To record the receipt of interest on Venice bonds) Oct. 1 4 (To record the sale of Venice bonds)
Share Investments ► Feb. 1 4 Aug. 1 ► Mar. 1 ► Dec. 31 Bal. A Debt Investments Apr. 1 Oct. 1 Dec. 31 Bal. A
Prepare the adjusting entry at December 31, 2020, to report the investment securities at fair value. All securities are considered to be trading securities Wildhorse has no significant influence over its share investments. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31
Show the statement of financial position presentation of investment securities at December 31, 2020. Wildhorse SE Statement of Financial Position (Partial) > €
Give the statement classification of each income statement account. Income Statement Account Category Dividend Revenue Gain on Sale of Share Investments Interest Revenue Loss on Sale of Debt Investments Unrealized Loss-Income