Big Seven Insurance Ltd owns numerous investments in

the shares #8424

Big Seven Insurance Ltd owns numerous investments in the shares

Big Seven Insurance Ltd. owns numerous investments in the shares of other companies.
Assume Big Seven Insurance Ltd. completed the following investment transactions:

2017

Feb. 12 Purchased 30,000 (total issued and outstanding common shares, 120,000) common
shares of Earl Mfg. Ltd. at a cost of $2,550,000. Commissions on the purchase were $15,000.

Jul. 2 Purchased 6,000 additional Earl Mfg. Ltd. common shares at a cost of $88.00 per share.
Commissions on the purchase were $400.

Aug. 9 Received the annual cash dividend of $2.00 per share on the Earl Mfg. Ltd. investment.

Oct. 16 Purchased 2,000 Excellence Ltd. common shares as a short-term investment, paying
$63.00 per share plus brokerage commission of $500.

Nov. 30 Received the semi-annual cash dividend of $2.50 per share on the Excellence Ltd.
investment.

Dec. 31 Received the annual report from Earl Mfg. Ltd. Net income for the year was
$1,160,000. Of this amount, Big Seven Insurance Ltd.'s proportion is 30 percent.

31 The current market value of the Excellence shares is $140,000.

2018

Jan. 14 Sold 5,000 Earl Mfg. Ltd. shares for $460,000, less commissions of $800.

Required

Record the transactions in the general journal of Big Seven Insurance Ltd. The company's year-
end is December 31.

Big Seven Insurance Ltd owns numerous investments in the shares

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