Assignment for ACG3111 This is the problem: The accounting records of Jamaican Importers, Inc., at January 1, 2018, included the following: Assets: Investments in IBM common shares 1,845,000 Less: Fair Value Adjustment (195,000) 1,650,000 No changes occurred during 2018 in the investment portfolio. Prepare appropriate adjusting entries at Dec 31, 2018, assuming that the values of the common share were: 1,315,000 My question is if this problem is relating to an AFS security, the unrealized holding loss on AFS investment would be debited to OCI instead of NI. However, when I did my homework, it seems that the correct answer is unrealized holding loss on AFS investment - NI. Could you tell me the explanation behind this answer, please?
Assignment for ACG3111
This is the problem:
The accounting records of Jamaican Importers, Inc., at January 1, 2018, included the following:
Assets:
Investments in IBM common shares 1,845,000
Less: Fair Value Adjustment (195,000)
1,650,000
No changes occurred during 2018 in the investment portfolio.
Prepare appropriate
1,315,000
My question is if this problem is relating to an AFS security, the unrealized holding loss on AFS investment would be debited to OCI instead of NI.
However, when I did my homework, it seems that the correct answer is unrealized holding loss on AFS investment - NI. Could you tell me the explanation behind this answer, please?
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