contestada

Use the financial statement effects template to record the following four transactions involving investments in marketable securities. Assume that all these transactions occur in 2018.
1. Purchased 12,000 common shares of Liu, Inc., at $12 cash per share.
2. Received a cash dividend of $1.10 per common share from Liu.
3. Year-end market price of Liu common stock is $11.25 per share.
4. Sold all 12,000 common shares of Liu for $133,800.
Use negative signs with your answers, when appropriate.

Respuesta :

Answer and Explanation:

The presentation of the financial statement effects template is shown below:

                                             Balance Sheet

Transaction Cash Asset + Non- cash Assets = Liabilities + Contributed Capital + Earned Capital

1 -$144,000 $144,000 $0.00  $0.00  $0.00

2 $13,200  $0.00  $0.00  $0.00  $13,200

3 $0.00  -$9,000  $0.00  $0.00  -$9,000

4 $133,800       -$135,000 $0.00  $0.00  -$1,200.00

                                                Income Statement

Transaction  Revenue   - Expenses = Net Income

1          $0.00          $0.00           $0.00

2          $13,200          $0.00           $13,200

3         $0.00                      -$9,000.00  -$9,000

4          $0.00          $1,200.00  -$1,200.00

Working note

1. 12,000 shares × $12 = $144,000

2. 12,000 shares × $1.10 = 13,200 shares

3. ($12 - $11.25) × 12,000 shares = $9,000

The amount of  items displayed in the financial statement affect that account and in which the amount is zero does not affect overall.

Otras preguntas