Fairbanks corporation purchased 400 shares of sherman inc


1. Fairbanks Corporation purchased 400 shares of Sherman Inc. common stock as an available-for sale investment for $13,200. During the year, Sherman paid a cash dividend of $3.25 per share. At yearend, Sherman stock was selling for $34.50 per share. Prepare Fairbanks's journal entries to record 

(a) The purchase of the investment, 

(b) The dividends received, and 

(c) The fair value adjustment. 

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Accounting Basics: Fairbanks corporation purchased 400 shares of sherman inc
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