Dragon Corporation acquired a 7% interest in the outstanding shares of Slayer Inc.on January 1,2007 at a cost of $200,000.Slayer reported net income and made dividend payments to its shareholders at noted below.On December 31,2009 Slayer declared bankruptcy as a result of a series of losses as noted.
Required:
(a)Prepare the journal entries that Dragon would make in each year.
(b)Prepare the general ledger account for Dragon's investment in Slayer.

Question

Dragon Corporation acquired a 7% interest in the outstanding shares of Slayer Inc.on January 1,2007 at a cost of $200,000.Slayer reported net income and made dividend payments to its shareholders at noted below.On December 31,2009 Slayer declared bankruptcy as a result of a series of losses as noted.  
Required:
(a)Prepare the journal entries that Dragon would make in each year.
(b)Prepare the general ledger account for Dragon's investment in Slayer.

Quizplus · Accepted Answer

The Answer of Dragon Corporation acquired a 7% interest in the outstanding shares of Slayer Inc.on January 1,2007 at a cost of $200,000.Slayer reported net income and made dividend payments to its shareholders at noted below.On December 31,2009 Slayer declared bankruptcy as a result of a series of losses as noted.  
Required:
(a)Prepare the journal entries that Dragon would make in each year.
(b)Prepare the general ledger account for Dragon's investment in Slayer.

Dragon Corporation Acquired a 7% Interest in the Outstanding Shares