prepare journal entries to record the facts in the case assuming that glenn used the 558845

Recording Passive Investments and Investments for Significant Influence – On August 4, 2012, Glenn Corporation purchased 3,000 shares of Riley Company for $150,000. The following information applies to the stock price of Riley Company:

Price

12/31/2011

$57

12/31/2012

51

12/31/2013

43

Riley Company declares and pays cash dividends of $2 per share on June 1 of each year.

Required:

1. Prepare journal entries to record the facts in the case, assuming that Glenn purchased the shares for the trading securities portfolio.

2. Prepare journal entries to record the facts in the case, assuming that Glenn purchased the shares for the available for sale securities portfolio.

3. Prepare journal entries to record the facts in the case, assuming that Glenn used the equity method to account for the investment. Glenn owns 30 percent of Riley and Riley reported $45,000 in income each year.

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