The Kansas Company buys 1,000 shares of Topeka Inc. on August 1, Year One, for...
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The Kansas Company buys 1,000 shares of Topeka Inc. on August 1, Year One, for $19 per share. Topeka paid a $1 per share cash dividend on December 12, Year One. The shares are worth $23 per share on December 31, Year One. Kansas sells this entire investment on April 7, Year Two, for $25 per share.
a. If this asset is viewed as an investment in trading securities, what is reported in the Year One
financial statements for Kansas?
b. If this asset is viewed as an investment in trading securities, what is reported in the Year Two
financial statements for Kansas?
c. If this asset is viewed as an investment in available-for-sale securities, what is reported in the Year One financial statements for Kansas?
d. If this asset is viewed as an investment in available-for-sale securities, what is reported in the Year Two financial statements for Kansas?
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