On January 01, 2020, Tiny Company bought back a portion of its own stock as...
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Finance
On January 01, 2020, Tiny Company bought back a portion of its own stock as treasury. Due to this transaction, Large Companys percentage share of Tiny Companys voting stock increased from 25% to 30%. For 2020, Tiny Company had $10,000 net loss and paid no dividend. Prepare a journal entry on the following date showing computation in short form.
On December 31, 2020 (2 points) On January 01, 2021, Large Company sold half of its investment to Medium Company for $50,000 cash. Prepare a journal entry on the following date showing computation in short form.
On January 01, 2021
(3 points) After the sale of investment,
(5) what is Large Companys percentage of ownership in Tiny Company, and
(6) can Large Company continue to use equity method, probably yes, or probably no, why? Answer in concise and complete sentences.
As for gain or loss on sale of investment in Tiny Company, on which financial statement of Large Company is it reported first, which financial statement of Large Company does it go through, and on which financial statement of Large Company does it end up on which account? Answer in concise and complete sentences. (10 points)
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