Question #3 On March 1, 2020, JBJ Co. acquired 1,000 shares of Hoi Co. for...
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Accounting
Question #3
On March 1, 2020, JBJ Co. acquired 1,000 shares of Hoi Co. for $40,000. This investment represents a 15% interest in Hoi Co. JBJ Co. has classified this investment as FVTOCI. On November 30, 2020, Hoi Co. paid a $35,000 dividend to its shareholders. On February 28, 2021, Hoi Co.s shares were valued at $50 per share and Cub Ltd. reported a net income of $170,000 for the year. On April 15, 2021, JBJ Co. sold the shares for $75,000. Both JBJ Co. and Hoi Co. have February 28, 2021 year ends.
Required:
Prepare dated journal entries for the investment on the acquiring company's books from acquisition to disposal. Ignore income taxes. Journal entry descriptions are optional.
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