Ringer Company acquired 40% of the outstanding stock of the Leopard Company for $370,000 on January 1, 2017.
The purchase price equaled 40% of the book value of Leopard Company. During 2017, Leopard engaged in the following activities:
April 7 Declared and paid a cash dividend, $175,000. Dec. 31 Reported annual earnings for 2017, $250,000. Required:
Prepare the journal entries that Ringer would need to make in 2017 with respect to its investment in Leopard
Company.

Question

Quizplus · Accepted Answer

The Answer of Ringer Company acquired 40% of the outstanding stock of the Leopard Company for $370,000 on January 1, 2017.
The purchase price equaled 40% of the book value of Leopard Company. During 2017, Leopard engaged in the following activities:
April 7 Declared and paid a cash dividend, $175,000. Dec. 31 Reported annual earnings for 2017, $250,000. Required:
Prepare the journal entries that Ringer would need to make in 2017 with respect to its investment in Leopard
Company.

Ringer Company Acquired 40% of the Outstanding Stock of the Leopard