Tekky Corporation purchased 10,000 shares of preferred stock – Class A in Hui Zu, Ltd. on December 15 for $100,000 and sold it the following June 22 for $114,000. Tekky does not have significant influence over the investee, Hui Zu, Ltd. This class of preferred stock is not actively traded and it does not have a readily determinable fair value. However, Hui Zu, Ltd. has another issue of preferred stock (Class B) outstanding that is nearly identical to the stock that Tekky holds except that it is publicly traded. The price of the Class B stock increased 10% between December 15 and December 31.
Tekky chooses to use the exception provided in the authoritative literature to measure the investment at adjusted cost. What journal entries are required to record these transactions?
Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.
You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.Read more
Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.Read more
Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.Read more
Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.Read more
By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.Read more