Please do not give solution in image format ? Additional Problem 2Novak Ltd. is a Canadian publicly-traded business with a December 31 fiscal year end. In order to get a better return on some of its excess cash, Novak purchased 110 common shares of AFS Corporationon July 1, 2020 at a price of $5 per share. Due to the nature of the investment Novak's management is accounting for the equity investment using the fair-value through other comprehensive income (FV-OCI) without recycling to net income. On August 1, 2020, AFS declared dividends of $1/share, and paid those dividends on August 20, 2020. On December 31, 2020, shares in AFS were trading at $7 pershare. On September 15, 2021, Novak sold the shares in AFS for $8 per share.Prepare the journal entries required to record the above transactions on the books of Novak Ltd. (Credit account titles are automatically indented when the amount is entered. Do not indentmanually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Record journal entries in the order presented in the problem.)Account Titles and ExplanationDebitCreditDateVYV(To adjust to fair value on date of disposition)(To record disposal)Fair Value-Other ComprehensiveIncome (OCI) without recycling:(To reclassify holding gain).1

A journal entry is a basic accounting record that is used to chronologically track financial…

avak Ltd. is a Canadian publicly-traded business with a December 31 fiscal year end. In order to get a better return on some of its excess cash, No July 1, 2020 at a price of $5 per share. Due to the nature of the investment Novak's management is accounting for the equity investment using I) without recycling to net income. On August 1, 2020, AFS declared dividends of $1/share, and paid those dividends on August 20, 2020. On De are. On September 15, 2021, Novak sold the shares in AFS for $8 per share.

avak Ltd. is a Canadian publicly-traded business with a December 31 fiscal year end. In order to get a better return on some of its excess cash, No July 1, 2020 at a price of $5 per share. Due to the nature of the investment Novak's management is accounting for the equity investment using I) without recycling to net income. On August 1, 2020, AFS declared dividends of $1/share, and paid those dividends on August 20, 2020. On De are. On September 15, 2021, Novak sold the shares in AFS for $8 per share.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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