User Account

All Pages

How the accounting treatment for debt investments differs

Assignment Help Accounting Basics
Reference no: EM132610995

Question - On March 28, 2020, Kermit Inc. purchased 45,000 shares of Bonobo Inc. for $15 per share. Bonobo has 100,000 shares outstanding. On December 1, Kermit received an $0.35 cash dividend per share. On December 31, 2020, Bonobo reported net income of $450,000. At this date, the market price of Bonobo stock is selling for $12 per share. On December 1, 2021, Kermit received a total of $10,000 of cash dividends from Bonobo. On December 31, 2021, Bonobo reported a net loss of $20,000 and the market price is selling for $6 per share on this date. On this date, Kermit sold all of the Bonobo stock for $6 per share.

Instructions - Record the necessary journal entries based on the information provided. Briefly explain, in words, how the accounting treatment for debt investments differs compared with the accounting treatment for equity investments?

Reference no: EM132610995

Questions Cloud

What actions employer might take to relieve some of hazards : Describe some of the areas within this workstation where this employee could be injured. Describe what actions the employer might take to relieve
What are the risks and benefits of HSBC positioning : Question - Case Discussion - What are the risks and benefits of HSBC's positioning itself as the "World's Local Bank"
Communication in wireless networks : Developing an understanding of communication in wireless networks and the limitations and challenges - Interference which may be caused by the cordless phone
Discuss an endangered species : Carbon capture and sequestration is the concept learned in this unit. What is one concept learned in this unit of which you were previously unaware?
How the accounting treatment for debt investments differs : Briefly explain, in words, how the accounting treatment for debt investments differs compared with the accounting treatment for equity investments
Examine the key attributes of solid and hazardous waste : Examine the key attributes of solid and hazardous waste. Evaluate technologies related to the minimization of industrial and hazardous wastes.
Describe one technological innovation : Describe one technological innovation that has been proven to reduce carbon dioxide emissions. Carbon dioxide is held responsible for much of global warming.
Briefly explain how this investment should be accounted : Briefly explain how this investment should be accounted for and how this would differ if Harris Pilton had instead purchased 30,000 shares
What are the conservation and preservation in national parks : Perform research in from other reputable sources online on either the conservation or preservation methods used in a national park of your choice.

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd