On April 5, 2004, Meyers company buys 5,000 shares of investee company for $12 p
ID: 2574289 • Letter: O
Question
On April 5, 2004, Meyers company buys 5,000 shares of investee company for $12 per share and pays commissions of $1,800. this represents 8% of the shares of investee and the investment is classified as available-for-sale. during 2004, myers receives $1 per share in dividends and investee earns $35,000. On december 31, 2004, the investee stock has a fair value of $15 per share. On February 3, 2005, the investment is sold for $16 per share less commissions of $2,000. What journal entry will Myers make at December 31, 2004 regarding the investment?
Explanation / Answer
At year end the above entry will be passed for adjusting fair value.
Working:
Date General journal Debit Credit Dec.31 2014 Unrealised holding gain- OCI 13,200 Investment in Kenyon corporation 13,200 [Fair value adjustment]Related Questions
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