Maurice Tutor

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About Maurice Tutor

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Elementary,Middle School,High School,College,University,PHD

Expertise:
Algebra,Applied Sciences See all
Algebra,Applied Sciences,Biology,Calculus,Chemistry,Economics,English,Essay writing,Geography,Geology,Health & Medical,Physics,Science Hide all
Teaching Since: May 2017
Last Sign in: 402 Weeks Ago, 1 Day Ago
Questions Answered: 66690
Tutorials Posted: 66688

Education

  • MCS,PHD
    Argosy University/ Phoniex University/
    Nov-2005 - Oct-2011

Experience

  • Professor
    Phoniex University
    Oct-2001 - Nov-2016

Category > Accounting Posted 22 Jul 2017 My Price 14.00

Perry Company

Perry Company had no short-term investments prior to year 2011. It had the following transactions involving short-term investments in available-for-sale securities during 2011.

Apr. 16 Purchased 8,000 shares of Gem Co. stock at $24.25 per share plus a $360 brokerage fee.

May 1 Paid $200,000 to buy 90-day U.S. Treasury bills (debt securities): $200,000 principal amount,

6% interest, securities dated May 1.

July 7 Purchased 4,000 shares of PepsiCo stock at $49.25 per share plus a $350 brokerage fee.

20 Purchased 2,000 shares of Xerox stock at $16.75 per share plus a $410 brokerage fee.

Aug. 3 Received a check for principal and accrued interest on the U.S. Treasury bills that matured on

July 29.

15 Received an $0.85 per share cash dividend on the Gem Co. stock.

28 Sold 4,000 shares of Gem Co. stock at $30 per share less a $450 brokerage fee.

Oct. 1 Received a $1.90 per share cash dividend on the PepsiCo shares.

Dec. 15 Received a $1.05 per share cash dividend on the remaining Gem Co. shares.

31 Received a $1.30 per share cash dividend on the PepsiCo shares.

Required

1. Prepare journal entries to record the preceding transactions and events.

2. Prepare a table to compare the year-end cost and fair values of Perry’s short-term investments in available-for-sale securities. The year-end fair values per share are: Gem Co., $26.50; PepsiCo, $46.50; and Xerox, $13.75.

3. Prepare an adjusting entry, if necessary, to record the year-end fair value adjustment for the portfolio of short-term investments in available-for-sale securities.

4. Explain the balance sheet presentation of the fair value adjustment for Perry’s short-term investments.

5. How do these short-term investments affect Perry’s (a) income statement for year 2011 and (b) the equity section of its balance sheet at year-end 2011?

Answers

Maurice Tutor
(5)
Status NEW Posted 22 Jul 2017 10:07 PM My Price 14.00

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