At December 31, 2021, Perth Inc. has the following investments. Assume the FVTPL investments are held for trading. Security Co. A common shares Co. B preferred shares Co. C common shares Total Investment Category FVTPL FVTPL FVTOCI Carrying Value $19,000 11,500 21,000 $51,500 Fair Value $16,000 14,000 19,000 $49,000 (a) Prepare the adjusting entries required at December 31 to reflect the above information. (b) Show the financial statement presentation (balance sheet AND statements of income and comprehensive income) of the investments and related transactions and adjustments at December 31, 2021. (Ignore income tax.) BE SPECIFIC AS TO CLASSIFICATION AND ACCOUNT TITLE. (c) Assuming that on March 20, 2022, Perth sold Co. B preferred shares for $13,000, and sold Co. A common shares for $17,500. Prepare the journal entries to record these transactions.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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At December 31, 2021, Perth Inc. has the following investments. Assume the FVTPL
investments are held for trading.
Security
Co. A common shares
Co. B preferred shares
Co. C common shares
Total
Investment
Category
FVTPL
FVTPL
FVTOCI
Carrying Value
$19,000
11,500
21,000
$51,500
Fair Value
$16,000
14,000
19,000
$49,000
(a) Prepare the adjusting entries required at December 31 to reflect the above information.
(b) Show the financial statement presentation (balance sheet AND statements of income
and comprehensive income) of the investments and related transactions and
adjustments at December 31, 2021. (Ignore income tax.)
BE SPECIFIC AS TO CLASSIFICATION AND ACCOUNT TITLE.
(c) Assuming that on March 20, 2022, Perth sold Co. B preferred shares for $13,000, and
sold Co. A common shares for $17,500. Prepare the journal entries to record these
transactions.
Transcribed Image Text:At December 31, 2021, Perth Inc. has the following investments. Assume the FVTPL investments are held for trading. Security Co. A common shares Co. B preferred shares Co. C common shares Total Investment Category FVTPL FVTPL FVTOCI Carrying Value $19,000 11,500 21,000 $51,500 Fair Value $16,000 14,000 19,000 $49,000 (a) Prepare the adjusting entries required at December 31 to reflect the above information. (b) Show the financial statement presentation (balance sheet AND statements of income and comprehensive income) of the investments and related transactions and adjustments at December 31, 2021. (Ignore income tax.) BE SPECIFIC AS TO CLASSIFICATION AND ACCOUNT TITLE. (c) Assuming that on March 20, 2022, Perth sold Co. B preferred shares for $13,000, and sold Co. A common shares for $17,500. Prepare the journal entries to record these transactions.
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