Brief Exercise 17-7 Teal Corporation purchased for $317,000 a 25% interest in Mu
ID: 2603144 • Letter: B
Question
Brief Exercise 17-7 Teal Corporation purchased for $317,000 a 25% interest in Murphy, Inc. This investment enables Teal to exert significant influence over Murphy. During the year, Murphy earned net income of $192,000 and paid dividends of $65,000 Prepare Teal's journal entries related to this investment. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Account Titles and Esplanation Crede To recond the purchase) To record the net income (To record the dividend Click if you would like to Show Work for this question Qn Shew w LEST OF ACCOUNTSExplanation / Answer
Answer :-
Journal Entries
Date
Account Titles and Explanation
L.F
Amount ($)
Amount ($)
Investment in Murphy Inc.
3,17,000
Cash
3,17,000
(To record the purchase )
Investment in Murphy Inc.
48,000
Investment Income
48,000
(To record the net income)
1,92,000*25%
Cash
16,250
Investment in Murphy Inc.
16,250
(To record the dividend)
65,000*25%
Date
Account Titles and Explanation
L.F
Amount ($)
Amount ($)
Investment in Murphy Inc.
3,17,000
Cash
3,17,000
(To record the purchase )
Investment in Murphy Inc.
48,000
Investment Income
48,000
(To record the net income)
1,92,000*25%
Cash
16,250
Investment in Murphy Inc.
16,250
(To record the dividend)
65,000*25%
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