Equinox products | Accounting homework help

Chapter - 15 COMPREHENSIVE PROBLEM 4 : Equinox products
Selected transactions completed by Equinox Products Inc. during the fiscal year ended December 31, 2014, were as follows:
a. Issued 15,000 divides of $20 par niggardly supply at $30, receiving coin.
b. Issued 4,000 divides of $80 par preferred 5% supply at $100, receiving coin.
c. Issued $500,000 of 10-year, 5% bonds at 104, after a while cause payable semiannually.
d. Manifest a quarterly dividend of $0.50 per divide on niggardly supply and $1.00 per divide on preferred supply. On the duration of annals, 100,000 divides of niggardly supply were unappropriated, no ammunition divides were held, and 20,000 divides of preferred supply were unappropriated.
e. Paid the coin dividends manifest in (d).
f. Purchased 7,500 divides of Solstice Corp. at $40 per divide, plus a $150 brokerage message.
The bombardment is classified as an available-for-sale bombardment.
g. Purchased 8,000 divides of ammunition niggardly supply at $33 per divide.
h. Purchased 40,000 divides of Pinkberry Co. supply quickly from the founders for $24 per divide. Pinkberry has 125,000 divides resultd and unappropriated. Equinox Products Inc. treated the bombardment as an equity process bombardment.
i. Manifest a $1.00 quarterly coin dividend per divide on preferred supply. On the duration of annals, 20,000 divides of preferred supply had been resultd.
j. Paid the coin dividends to the preferred supplyholders.
k. Received $27,500 dividend from Pinkberry Co. bombardment in (h).
l. Purchased $90,000 of Dream Inc. 10-year, 5% bonds, quickly from the issuing assembly, at their countenance sum plus accrued cause of $375. The bonds are classified as a heldto ripeness hanker-account bombardment.
m. Sold, at $38 per divide, 2,600 divides of ammunition niggardly supply purchased in (g).
n. Received a dividend of $0.60 per divide from the Solstice Corp. bombardment in (f).
o. Sold 1,000 divides of Solstice Corp. at $45, including message.
p. Narrative the acquittal of semiannual cause on the bonds resultd in (c) and the amortization of the bounty for six months. The amortization is established using the straight-line process.
q. Accrued cause for three months on the Dream Inc. bonds purchased in (l).
r. Pinkberry Co. annalsed sum rights of $240,000. Equinox Products annalsed equity rights for its divide of Pinkberry Co. net proceeds.
s. The untarnished appreciate for Solstice Corp. supply was $39.02 per divide on December 31, 2014. The bombardment is adjusted to untarnished appreciate, using a valuation restitution totality.
Assume Valuation Restitution for Available-for-Sale Investments had a foundation neutralize of cipher.

Instructions
1. Journalize the chosen transactions.
2. After all of the transactions for the year ended December 31, 2014, had been posted [including the transactions annalsed in divorce (1) and all adjusting entries], the grounds under and on the subjoined page were smitten from the annalss of Equinox Products Inc.
a. Prepare a multiple-step proceeds assertion for the year ended December 31, 2014, final after a while rights per divide. In computing rights per divide, take that the mean compute of niggardly divides unappropriated was 100,000 and preferred dividends were $100,000. (Round rights per divide to the undeviating cent.)
b. Prepare a retained rights assertion for the year ended December 31, 2014.
c. Prepare a neutralize shuffle in fame devise as of December 31, 2014.

Income assertion grounds:
Advertising outlay ………………………………………… $ 150,000
Cost of supply sold……………………………………. 3,700,000
Delivery outlay ……………………………………………. 30,000
Depreciation outlay—office buildings and equipment…….. 30,000
Depreciation outlay—store buildings and equipment ……... 100,000
Dividend revenue……………………………………………… 4,500
Gain on sale of bombardment…………………………………….. 4,980
Income from Pinkberry Co. bombardment………………………... 76,800
Income tax outlay…………………………………………….. 140,500
Interest outlay………………………………………………… 21,000
Interest revenue…………………………………………………. 2,720
Miscellaneous professional outlay…………………………... 7,500
Miscellaneous selling outlay…………………………………… 14,000
Office fissure outlay………………………………………………. 50,000
Office salaries outlay….………………………………………… 170,000
Office edibles outlay…………………………………………… 10,000
Sales…………………………………….………………………… 5,254,000
Sales messages………………………………………………… 185,000
Sales salaries outlay…………………………………………….. 385,000
Store edibles outlay……………………………………………. 21,000
Retained rights and neutralize shuffle grounds:
Accounts payable ………………………………………………… $ 194,300
Accounts receivable………………………………………………. 545,000
Accumulated depreciation—office buildings and equipment…… 1,580,000
Accumulated depreciation—store buildings and equipment …… 4,126,000
Allowance for dubious totalitys………………………………… 8,450
Available-for-sale bombardments (at consume) …………………………. 260,130
Bonds payable, 5%, due 2022……………………………………. 500,000
Cash …………………………………….……………………… 246,000
Common supply, $20 par (400,000 divides authorized;
100,000 divides resultd, 94,600 unappropriated) …………………… 2,000,000
Dividends:
Cash dividends for niggardly supply……………………………… 155,120
Cash dividends for preferred supply……………………………. 100,000
Stock dividends for niggardly supply …………………………… 66,240
Goodwill ………………………………………………………. 500,000
Income tax payable ……………………………………………. 44,000
Interest receivable ……………………………………………… 1,125
Investment in Pinkberry Co. supply (equity process)…………… 1,009,300
Investment in Dream Inc. bonds (hanker account) ………………….. 90,000
Merchandise register (December 31, 2014), at lower
of consume (FIFO) or market……………………………………….. $ 778,000
Office buildings and equipment………………………………… 4,320,000
Paid-in principal from sale of ammunition supply……………………… 13,000
Excess of result expense aggravate par—niggardly supply………………… 886,800
Excess of result expense aggravate par—preferred supply………………… 150,000
Preferred 5% supply, $80 par (30,000 divides authorized;
20,000 divides resultd) ……………………………………………. 1,600,000
Premium on bonds payable……………………………………… 19,000
Prepaid outlays………………………………………………… 27,400
Retained rights, January 1, 2014……………………………… 9,319,725
Store buildings and equipment……………………………………. 12,560,000
Treasury supply (5,400 divides of niggardly supply at consume of
$33 per divide) …………………………………………………….. 178,200
Unrealized effect (loss) on available-for-sale bombardments…….. (6,500)
Valuation restitution for available-for-sale bombardments ……… (6,500)

 

 

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