At December 31, 2023, the equity investments of Monty Inc. that were accounted for using the FV-OCI model without recycling were as follows: Investment Ahn Inc. Burnham Corp. Chi Ltd. Total Cost and Carrying Amount $176,800 120,300 73,200 $370,300 Fair Value $150,700 139,400 75,300 $365,400 Unrealized Gain (Loss) $(26,100) 19,100 2,100 $(4,900) Because of a change in relationship with Ahn, Monty sold its investment in Ahn for $153,900 on January 20, 2024. No other investments were acquired or sold during 2024; however, a dividend of $1,400 was received from Burnham in June. At December 31, 2024, the fair values of Burnham and Chi shares were $152,400 and $72,200, respectively.
At December 31, 2023, the equity investments of Monty Inc. that were accounted for using the FV-OCI model without recycling were as follows: Investment Ahn Inc. Burnham Corp. Chi Ltd. Total Cost and Carrying Amount $176,800 120,300 73,200 $370,300 Fair Value $150,700 139,400 75,300 $365,400 Unrealized Gain (Loss) $(26,100) 19,100 2,100 $(4,900) Because of a change in relationship with Ahn, Monty sold its investment in Ahn for $153,900 on January 20, 2024. No other investments were acquired or sold during 2024; however, a dividend of $1,400 was received from Burnham in June. At December 31, 2024, the fair values of Burnham and Chi shares were $152,400 and $72,200, respectively.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
13, pls answer part e thanks.
Transcribed Image Text:At December 31, 2023, the equity investments of Monty Inc. that were accounted for using the FV-OCI model without recycling were
as follows:
Investment
Ahn Inc.
Burnham Corp.
Chi Ltd.
Total
(a)
Cost and
Carrying Amount
$176,800
Date
120,300
Dec. 31,
2023
73,200
$370,300
Your answer is correct.
Fair Value
$150,700
139,400
FV-OCI Investments
75,300
$365,400
Because of a change in relationship with Ahn, Monty sold its investment in Ahn for $153,900 on January 20, 2024. No other
investments were acquired or sold during 2024; however, a dividend of $1,400 was received from Burnham in June. At December 31,
2024, the fair values of Burnham and Chi shares were $152,400 and $72,200, respectively.
Account Titles and Explanation
Unrealized Gain or Loss - OCI
Unrealized
Gain (Loss)
$(26,100)
Prepare the entry to adjust the portfolio of investments to fair value at December 31, 2023. (Credit account titles are automatically
indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for
the amounts. List debit entry before edit entry.)
19,100
2,100
$(4,900)
Debit
4900
Credit
4900
Transcribed Image Text:Prepare the journal entries for the 2024 sale of the investment in Ahn, including reclassifying holding gains or losses to retained
earnings and for the dividend received from Burnham. (Credit account titles are automatically indented when the amount is entered.
Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Record entries in the
order displayed in the problem statement. List all debit entries before credit entries.)
(e)
Date
Jan. 20, 2024
Jan. 20, 2024 v
Jan. 20, 2024
June 2024
v
Solution
Account Titles and Explanation
List of Accounts
FV-OCI Investments
Unrealized Gain or Loss - OCI
(To adjust to fair value at date of disposal)
Cash
FV-OCI Investments
(To record disposal)
eTextbook and Media
Retained Earnings
Accumulated Other Comprehensive Income
(To reclassify holding loss)
Cash
Dividend Revenue
Account Titles and Explanation
Debit
Debit
3200
153900
22900
1400
Credit
Prepare the journal entry required at December 31, 2024, to adjust the investments to fair value. (Credit account titles are
automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles
and enter o for the amounts. List debit entry before credit entry.)
Credit
15
2
Attempts: 3 of 3 used
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education