1. The Janjua Company had the following account balances at 1/1/22: Common Stock Treasury Stock (at cost) Paid-in-Capital in Excess of Par Investments in AFS Equity Securities FVA (AFS) Retained Earnings $50,000 (a) Required for Part I: 12,000 200,000 37,000 2,500 credit 35,000 On that date, the Accumulated OCI account was at its proper balance. There were no sales or purchases of Common Stock or Investments during 2016. Prior to any adjusting journal entries related to the investments, 2022 Net Income was $7,800. No other transactions affecting Retained Earnings occurred. Fair Value of the Investments at 12/31/2022 was $34,700. (b) Prepare the 12/31/22 journal entry to adjust the investment to fair value. (c) Prepare the complete 12/31/22 Equity section of the balance sheet.
1. The Janjua Company had the following account balances at 1/1/22: Common Stock Treasury Stock (at cost) Paid-in-Capital in Excess of Par Investments in AFS Equity Securities FVA (AFS) Retained Earnings $50,000 (a) Required for Part I: 12,000 200,000 37,000 2,500 credit 35,000 On that date, the Accumulated OCI account was at its proper balance. There were no sales or purchases of Common Stock or Investments during 2016. Prior to any adjusting journal entries related to the investments, 2022 Net Income was $7,800. No other transactions affecting Retained Earnings occurred. Fair Value of the Investments at 12/31/2022 was $34,700. (b) Prepare the 12/31/22 journal entry to adjust the investment to fair value. (c) Prepare the complete 12/31/22 Equity section of the balance sheet.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Subject- account
Transcribed Image Text:1. The Janjua Company had the following account balances at 1/1/22:
Common Stock
Treasury Stock (at cost)
Paid-in-Capital in Excess of Par
Investments in AFS Equity Securities
FVA (AFS)
Retained Earnings
$50,000
(a) Required for Part I:
12,000
200,000
37,000
2,500 credit
35,000
On that date, the Accumulated OCI account was at its proper balance. There were no sales or
purchases of Common Stock or Investments during 2016. Prior to any adjusting journal entries
related to the investments, 2022 Net Income was $7,800. No other transactions affecting Retained
Earnings occurred. Fair Value of the Investments at 12/31/2022 was $34,700.
(b) Prepare the 12/31/22 journal entry to adjust the investment to fair value.
(c) Prepare the complete 12/31/22 Equity section of the balance sheet.
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