Create an Account

Already have account?

Forgot Your Password ?

Home / Questions / Glacier Products Inc. is a wholesaler of rock climbing gear The company began operations o...

Glacier Products Inc. is a wholesaler of rock climbing gear The company began operations on January 1 2016 The following transactions relate to securities acquired by Glacier Products Inc

Glacier Products Inc. is a wholesaler of rock climbing gear. The company began operations on January 1, 2016. The following transactions relate to securities acquired by Glacier Products Inc., which has a fiscal year ending on December 31: 2016 Jan. 18. Purchased 9,000 shares of Malmo Inc. as an available-for-sale investment at $40 per share, including the brokerage commission. July 22. A cash dividend of $3.00 per share was received on the Malmo stock. Oct. 5. Sold 500 shares of Malmo Inc. stock at $58.00 per share, less a brokerage commission of $100. Dec. 18. Received a regular cash dividend of $3.00 per share on Malmo Inc. stock. 31. Malmo Inc. is classified as an available-for-sale investment and is adjusted to a fair value of $36.00 per share. Use the valuation allowance for available-for-sale investments account in making the adjustment. 2017 Jan. 25. Purchased an influential interest in Helsi Co. for $800,000 by purchasing 75,000 shares directly from the estate of the founder of Helsi. There are 250,000 shares of Helsi Co. stock outstanding. July 16. Received a cash dividend of $3.00 per share on Malmo Inc. stock. Dec. 16. Received a cash dividend of $3.00 per share plus an extra dividend of $0.20 per share on Malmo Inc. stock. 31. Received $38,000 of cash dividends on Helsi Co. stock. Helsi Co. reported net income of $170,000 in 2015. Glacier Products Inc. uses the equity method of accounting for its investment in Helsi Co. 31. Malmo Inc. is classified as an available-for-sale investment and is adjusted to a fair value of $44 per share. Use the valuation allowance for available-for-sale investments account in making the adjustment for the increase in fair value from $36 to $44 per share. Instructions 1. Journalize the entries to record the preceding transactions. 2. Prepare the investment-related asset and stockholders’ equity balance sheet presentation for Glacier Products Inc. on December 31, 2017, assuming the Retained Earnings balance on December 31, 2017, is $700,000.

Apr 02 2020 View more View Less

Answer (Solved)

question Subscribe To Get Solution

Related Questions