User Account

All Pages

Indicate the effect of this investment

Assignment Help Accounting Basics
Reference no: EM13881572

1.On January 2, 2013, Sanborn Tobacco, Inc., bought 5% of Jackson Industry's capital stock for $90 million as a temporary investment. Sanborn realized that these securities normally would be classified as available for sale, but elected the fair value option to account for the investment. Jackson Industry's net income for the year ended December 31, 2013, was $120 million. The fair value of the shares held by Sanborn was $98 million at December 31, 2013. During 2013, Jackson declared a dividend of $60 million.

Required:
1. Would this investment be classified on Sanborn's balance sheet as held to maturity securities, trading securities, available for sale securities, significant influence investments, or other? Explain.
2. Prepare all appropriate journal entries related to the investment during 2013.
3. Indicate the effect of this investment on 2013 income before taxes.

Reference no: EM13881572

Questions Cloud

Suspension of calcium carbonate particles in water flows : A suspension of calcium carbonate particles in water flows through a pipe. Your assignment is to determine both the flow rate and the composition of this slurry. You proceed to collect the stream in a graduated cylinder for 1.00 min; you then weig..
What is the bun-creatinine ratio : In the United States, the average number of airplanes in the sky on an average morning is 4000. What is BUN-creatinine ratio
American recovery and reinvestment act of 2009 was implement : The American Recovery and Reinvestment Act of 2009 was implemented primarily
Promote free trade and open markets around the world : The *blank* is a global institution that was established to promote free trade and open markets around the world. a) United Nations  b) World Trade Organization
Indicate the effect of this investment : On January 2, 2013, Sanborn Tobacco, Inc., bought 5% of Jackson Industry's capital stock for $90 million as a temporary investment.
What is the temperature at the condenser outlet : What is the temperature at the condenser outlet? Explain how you know (a single sentence should suffice). Prepare and fill in an inlet-outlet enthalpy table and calculate the required cooling rate in kW.
What is the optimal production plan for jumbo : What is the optimal production plan For Jumbo. assuming no promotion by either Jumbo or Shrimpy'? What are the annual profits for Jumbo?
Below is the schematic depiction : As Vice President of Client Services, you have been contacted by your client regarding a new advertisement that has recently run in a popular national women's magazine. Your client is an upscale women's clothing retailer. Below is the schematic depic..
Show that for large n, this estimate of ? is equal to one : Show that for large n, this estimate of ρ is equal to the one obtained by the simpler formula (1 - d/2).

Reviews

Write a Review

Accounting Basics Questions & Answers

  Sales are collected 75 in the month of sale and 25 in the

ace inc shows a cash balance of 24000 on january 1 2008. the expected sales in units of its product by month for the

  Annual amortization of goodwill

The fair value of all Hathaway's identifiable tangible and intangible assets was $48,000,000. Short will amortize any goodwill over the maximum number of years allowed. What is the annual amortization of goodwill for this acquisition?

  How might the information contained within the stockholder

how might the information contained within the stockholder eqity statement be used for management and investors

  Journalize the bond using the bond

Journalize the bond issuance. Using the bond from the above journalize the first interest payment and the amortization of the related bond discount.

  The four main behavioral considerations in management

the four key behavioral considerations in management accounting and control system design include all of the following

  Determining the overall audit approach

The auditor must assess this risk as a basis for identifying areas most likely to be misstated as well as a basis for determining the overall audit approach and extent of procedures to be performed. Do you agree? Please explain.

  Compute both the rate variance and efficiency variance for

nolan mills uses a standard cost system. during may nolan manufactured 15000 pillowcases using 27600 yards of fabric

  What amount of these gifts is deductible before application

brett an employee makes the following gifts none of which are reimbursedbretts supervisor 30.00bretts secretary 40.004

  The offices 5 canon machines are expected to last 6 more

the lansing community college registrars office is considering replacing some canon copiers with faster copiers

  How should the brandon company determine the amounts

the brandon company a manufacturer and the schimmel company a retailer entered into a business combination whereby

  Soft cushion company scc is highly decentralized

Soft Cushion Company (SCC) is highly decentralized. Each division is empowered to make its own sales decisions. The Assembly Division can purchase a key component-stuffing-from the Production Division or from external suppliers.

  Cash flows during the first year of operations for the

cash flows during the first year of operations for the harman-kardon consulting company were as follows cash collected

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