Inspiration Company had trading and nontrading investments held throughout 2021 and 2022. The nontrading investments are measured at fair value through other comprehensive income. The investments had a cost of P3,000,000 for trading, and P3,000,000 for nontrading. The investments had the following fair value at year end. 12/31/21 12/31/22 Trading Nontrading 4,000,000 3,200,000 3,800,000 3,700,000 What amount of cumulative unrealized gain or loss will be reported in the statement of changes in equity on December 31, 2022?
Q: change during 2019 in the composition of the portfolio of trading securities. On December 31, 2020…
A: Unrealized income is an income that has been earned but not received as the asset through which it…
Q: Pompey Inc. carries the following marketable equity securities on its books at December 31, 2019 and…
A: Fair value of Financial asset @ FVOCI at 12/31/2020 P50,00,000 Fair value of Financial asset @…
Q: unrealized gain or loss?
A: During 2020 , Boston Company purchased marketable securities as a trading investment. At the end of…
Q: An entity purchased 4-year debt instruments with a face value of P10,000,000 on January 1, 2019 to…
A: Note:- Since you have posted a question with multiple sub-parts, we will solve the first three…
Q: At December 31, 2018, Stone Co. reported an unrealized loss of P1,500 to reduce investments to…
A: The unrealized gain or loss is computed by deducting the cost (or beginning balance) of investment…
Q: Company acquired equity securities during the year 2018 and designated as fair value to other…
A: Investment in shares is the investment which is done by the investor to get gain by the increase in…
Q: On December 31, 2021, Kona purchased debt securities as trading securities. Pertinent data are as…
A: An income statement, also known as a statement of Profit or Loss Account (p/l), is a statement that…
Q: At December 31, 2020, the available-for-sale debt investment for Zorro Community Bancorp has…
A: Other comprehensive income is that income which is not the part of profit and loss(P/L) account.…
Q: At December 31, 2022, ABC Corp. had the following equity securities that were purchased during 2022,…
A: A corporation that engages in trading securities will acquire and hold investments with the goal of…
Q: For the year ended December 31, 2019, WQA company reported opening retained earnings of P1,850,000…
A: The reserve balance at December 31. 2020 = P35, 000
Q: Some of Ivanhoe Corporation's investments in debt securities are classified as trading securities…
A: Journal entries are the primary reporting of the business transactions in the books of accounts.…
Q: lassification Cost or Amortized Cost Fair Value at end if 2017 Interest Income in 2017 Sales Price…
A: Accumulated Other Comprehensive account includes the gain or loss that arose from the equity section…
Q: Current Attempt in Progress Some of Sheridan Corporation's investments in debt securities are…
A: Fair value adjustment - Trading account = $2,600 debitFair value adjustment - Available for sale =…
Q: The following selected transactions relate to investment activities of Ornamental Insulation…
A: Journal Entry: Method of recording financial transactions in the book of original entry by debiting…
Q: On December 21, 2025, Pina Company provided you with the following information regarding its equity…
A: Investment -An asset is something that is purchased with the intention of earning revenue or…
Q: On its December 31, 2020, balance sheet, Trump Company reported its investment in equity securities,…
A: The objective of the question is to determine how the Trump Company should report the change in fair…
Q: ng Securities: ity A ity B tals rities Available-for-Sale: rity C ity D tals ities to Be…
A: Securities held-to-maturity -Securities that businesses buy to hold onto until they mature are…
Q: Surface Company purchased 1,000 bonds of Slick Company in 2018 for $760 per bond and classified the…
A: Number of bonds purchased = 1000 Purchase price of bonds= $ 760 per bond Sale price of bonds = $ 380…
Q: No investments were sold during 2021. All securities except Security D and Security F are considered…
A: Reported on Balance Sheet as: Unrealized gain (loss) included in: Current…
Q: Rolling Hills Productions held investments in equity securities (in Elban Company)with a fair value…
A: Correct option is “a”: $68,000 In the balance sheet of the year 2018, the equity investments are…
Q: Debt Investments Classification Cost or Amortized Cost Fair Value at end if 2017 Interest Income in…
A: The income statement represents the net income or net loss that is calculated by the deducted…
Q: A company purchases debt securities for $100,000 at the beginning of 2022. It classifies as trading…
A: An investment in debt securities may be classified as either trading securities, available for sale…
Q: At December 31, 2021, Perth Inc. has the following investments. Assume the FVTPL investments are…
A: A journal is a detailed account that records all the financial transactions of a business, to be…
Q: Urgently required answer to following: The following information related to stock investments of…
A: Adjusting entry: Adjusting journal entry is made at the end of the fiscal period to reflect the…
Q: Complete the following table by putting the proper amount in each column: Assume that $100,000…
A: Step 1 If any debt instrument is held for sale, then all the fair value adjustments are adjusted…
Q: On March 25, 2021, Phillips Corporation purchased bonds of Atlas Corporation for $132 million and…
A: The company can make investments in bonds. The investment in bonds can be classified as trading…
Q: Answer all the subparts a,b,c On December 31, 2020, CFR Co. provided the following information as…
A: Trading Securities are the financial instruments purchased by the company to deal within 1 year.…
Q: An entity purchased 4 year debt instruments with a face value of P15,000,000 on January 1, 2019 to…
A: Note:- Since you have posted a question with multiple sub-parts, we will solve the first three…
Q: At the end of 2018, Hodge Company prepared the following schedule of investments in trading debt…
A: Investment means an asset purchased in expectation of earning a return on such investment in future…
Q: On January 1, 2024, Everglade Company purchased the following debt securities and properly accounted…
A: To calculate the amount that Everglade Company should report relative to these securities in its…
Q: At December 31, 2020, the available-for-sale debt portfolio for Steffi Graf, Inc. is as follows.…
A: Income statement: The financial statement which reports revenues and expenses from business…
Q: quity h other comprehensive income, w at fair value of P550,000. At Dece lue of the securities was…
A: Income statement termed as IS which is one of the financial statements of the company and this…
Q: At the beginning of 2019, Ace Company had the following portfolio of investments in…
A: FASB indicates a non-profit private orientation that is engaged in providing guidelines to deal with…
Q: Green Corporation began operations in 2021. An analysis of Green’s equity investments portfolio…
A: The non trading securities are reported as separate component of shareholder's equity. The…
Q: Beresford Inc. purchased several investments in debt securities during 2020, its first year of…
A: Introduction: A balance sheet is one of the financial statements that cover the assets, liabilities,…
Q: At the beginning of 2019, Ace Company had the following portfolio of investments in…
A: Unrealized loss occurs when a stock decreases after an investor buys it, but yet has to sell it. If…
Q: Some of Cullumber Lake Limited's investment securities are classified as trading securities and some…
A: Trading securities are those securities that the entity holds to grab short-term profit. It means…
Q: On January 1, 2020, the Stew Corporation purchased equity securities to be held for trading purposes…
A: It is pertinent to note that trading securities are always measured at fair value through profit and…
Q: At the end of 2018, Terry Company prepared the following schedule of investments in…
A: Journal entry: Journal entry is a set of economic events which can be measured in monetary terms.…
Q: On December 31, 2019, Novak Corp. provided you with the following pre-adjustment information…
A: Adjusting Entries Adjusting journal entries made at the end of the fiscal…
Q: Strawberry Corp. has various equity investment at fair value through profit or loss transactions…
A: Lets understand the basics. Investments are generally record through three methods which are, (1)…
Q: OFIA had investments in equity securities costing P1,000,000 that were classifies as investment in…
A: When Investments are reclassified at fair value through profit and loss which were earlier…
Q: 2. During 2020, Earl Company purchased debt securities as a long-term investment and classified them…
A: Debt and equity investments held as Trading securities are usually bought to sell them in a short…
Q: The table below indicates the carrying amounts (and cost), and fair values of Quintox's FV-OCI…
A: Investment at FVOCI requires investment to be carried at fair value. Under this approach, fair value…
Q: At December 31, 2020, the end of its first year of operations, the non-trading securities for Oriole…
A: A business is documented in the accounting records of the company using a journal entry. The general…
Q: A company buys a debt investment for $316, 000. At the end of 2023, the amortized cost of the…
A: The given statement is false.In this scenario, the company must report the investment at its fair…
Q: At December 31, 2025, the available-for-sale debt portfolio for Pharoah, Inc. is as fol Unrealized…
A: Unrealized holding gains or losses refer to changes in the fair value of assets, such as…
Q: Marigold Company in its first year of operations provides the following information related to one…
A: Journal: Recording of a business transactions in a chronological order.
Q: value of $618000. At December 31, 2025, the fair value of the securities was $649000. What should…
A: An unrealized gain is an increase in the value of an asset or investment that has not been sold by…
Step by step
Solved in 2 steps
- Please help with problem. At the beginning of 2019, Ace Company had the following portfolio of investments in available-for-sale debt securities (all of which were acquired at par value): Security Cost 1/1/19 Fair Value A $25,000 $31,000 B 38,000 36,000 Totals $63,000 $67,000 During 2019, the following transactions occurred: Transactions: May 3 Purchased C debt securities at their par value for $50,000. July 1 Sold all of the A securities for $31,000 plus interest of $1,000. Dec. 31 Received interest of $1,000 on the B and C securities. Additionally the following information was available: Security 12/31/19 Fair Value B $42,000 C 53,000 Required: 1. Prepare journal entries to record the preceding information. 2. What is the balance in the Unrealized Holding Gain/Loss account on December 31, 2019? 3. Next Level What justification does the FASB give for its treatment of unrealized holding gains and losses…In 2019, Edward Company purchased equity securities as a trading investment. For the year ended December 31, 2019, the entity recognized an unrealized holding loss of P230,000. There were no security transactions during 2020. Pertinent information on December 31, 2020 is as follows: Security Cost Market Value A 2,450,000 2,300,000 B 1,800,000 1,820,000 4,250,000 4,120,000 In the 2020 income statement, what amount should be reported as unrealized holding gain or loss?At December 31, 2020, the available-for-sale debt portfolio for Crane, Inc. is as follows. Security A B C Total Previous fair value adjustment balance-Dr. Fair value adjustment- Dr. Cost $17,500 12,200 500 Fair Value $1,300 $15,000 23,400 25,700 $53,100 $54,900 14,200 Unrealized Gain (Loss) $(2,500 2,000 2,300 1,800 ) On January 20, 2021, Crane, Inc. sold security A for $15,100. The sale proceeds are net of brokerage fees. Crane, Inc. reports net income in 2020 of $118,000 and in 2021 of $143,000. Total holding gains (including any realized holding gain or loss) equal $49,000 in 2021. Prepare a statement of comprehensive income for 2020, starting with net income. Prepare a statement of comprehensive income for 2021, starting with net income. Please show underlying calculations (especially for reclassification adjustment for 2021). I correctly identified the statement of income for 2020, but am stuck on the one for 2021. Thank you!
- Problem 19: 56. On its December 31, 2020 balance sheet, Polo Company reported securities measured at fair value through other comprehensive income. These securities were acquired at a cost P360,000 and had a year-end fair value of P330,000. On December 31, 2021, the fair value of the securities was P350,000. What should Polo report as 2021 income or loss in the profit or loss statement as a result of the change in market value? Problem 20: Fastfoods Company acquired the following investments classified as trading securities on August 20, 2020: Jolibee shares KFC shares 400,000 250,000 300,000 P McDonald shares On December 31, 2020, the close of the year, these investments had the following market values: Jolibee shares KFC shares 450,000 220,000 310,000 McDonald shares 57. On February 23, 2021, Fastfoods company sold the KFC shares for P230,000. How much would berecognized as gain/ (loss) on sale of securities on the sale of the KFC shares as a component of other comprehensive income?At the beginning of 2019, Ace Company had the following portfolio of investments in available-for-sale debt securities (all of which were acquired at par value): Security Cost 1/1/19 Fair Value A $45,000 $56,000 B 68,000 65,000 Totals $113,000 $121,000 During 2019, the following transactions occurred: Transactions: May 3 Purchased C debt securities at their par value for $50,000. July 1 Sold all of the A securities for $56,000 plus interest of $1,000. Dec. 31 Received interest of $1,000 on the B and C securities. Additionally the following information was available: Security 12/31/19 Fair Value B $75,000 C 53,000 Required: 1. Prepare journal entries to record the preceding information. 2. What is the balance in the Unrealized Holding Gain/Loss account on December 31, 2019? 3. Next Level What justification does the FASB give for its treatment of unrealized holding gains and losses for available-for-sale…Skywalker Limited purchased shares of Jedi Jewelers during 2022 for $124,000. Skywalker elected the fair value option for accounting for this investment. At year end 2022, 2023, and 2024, this investment had a fair value of $120,000, $134,000, and $137,000, respectively. What is the amount of unrealized gain or loss reported on this investment at year-end 2024? Group of answer choices Unrealized Loss of $10,000 Unrealized Gain of $14,000 Unrealized Gain of $17,000 Unrealized Gain of $3000
- Sunland Technologies Inc. held a portfolio of shares and bonds that it accounted for using the fair value through other comprehensive income model at December 31, 2023. This was the first year that Sunland had purchased investments. In part due to Sunland's inexperience, by December 31, 2023, the market value of the portfolio had dropped $29,700 below its original cost. Sunland recorded the necessary adjustments at December 31, 2023, and was determined to hold the securities until the unrealized loss from 2023 could be recovered. By December 31, 2024, Sunland's goal of recovery had been realized and the original portfolio of shares and bonds had a fair market value $6,600 higher than the original purchase costs. Sunland's income tax rate is 30% for all years. Assume that any gains that will ultimately be realized on the sale of the shares and bonds are taxable as ordinary income when they are realized. Sunland applies IFRS. (a) Prepare the journal entries at December 31, 2023, to…• The following information is available for Alpha's investments: Fair Value Market Original Adjustment Value Investment Cost 12/31/2020 Classification 12/31/2021 Available for Beta bonds $80,000 $6,000 dr. $78,000 Sale Gamma bonds $60,000 $4,000 cr. Trading $66,000 The journal entries on 12/31/21 for Beta will include: O Debit to Unrealized Loss - OCI for $8,000 O Debit to Unrealized Loss - NI for $2,000 O Debit to Unrealized Loss - NI for $6,000 O Debit to Unrealized Loss - NI for $8,000At the end of 2018, Terry Company prepared the following schedule of investments in available-for-sale debt securities (all of which were acquired at par value): Company Amortized Cost 12/31/18 Fair Value Cumulative Change in Fair Value Morgan Company $30,000 $29,200 $(800) Nance Company 50,000 53,200 3,200 Totals $80,000 $82,400 $2,400 During 2019, the following transactions occurred: July 1 Purchased Oscar Company debt securities with a par value of 100,000 for $97,000. The securities carry an annual interest rate of 10%, mature on December 31, 2021, and pay interest seminannually on July 1 and December 31. Terry uses the straight-line method to amortize any discounts or premiums. Oct. 11 Sold all of the Morgan Company securities for $28,000 plus interest of $1,200. Dec. 31 Received interest of $6,000 on the Nance Company and Oscar Company debt securities, and the following yearend total market values were available: Nance Company debt securities, $54,000;…
- Investment in Trading and AFS Securities A company purchases debt securities for $100,000 at the beginning of 2022. It classifies as trading securities and $60,000 as AFS securities. It sells the securities in 2023. Required For each of the following scenarios, indicate the net effect on income and other comprehensive income in each year 2022 and 2023. In each case, any unrealized decline in value below cost is expected to be recovered and is attributed to market factors. a. Fair value, end of 2022 Selling price, 2023 Note: Use a negative sign with an answer to indicate the net effect amount decreases Income or OCI. Income OCI 5,000 ✓ (1,000) * End of 2022 $ 2023 b. Trading securities AFS securities $38,000 $65,000 43,000 64,000 Fair value, end of 2022 Selling price, 2023 (2,000)✓ $ 5,000 x End of 2022 $ 2023 Trading securities AFS securities $45,000 $56,000 42,000 68,000 Note: Use a negative sign with an answer to indicate the net effect amount decreases Income or OCI. OCI (4,000)✓ 0…In 2020, which is the first year of operation, Priscilla Inc. made various investments in trading securities. The investments had the following cost and market value on December 31, 2020: For the year 2020, what amount should be included as unrealized loss on the income statement?On March 25, 2021, Phillips Corporation purchased bonds of Atlas Corporation for $160 million and classified the securities as trading securities. On December 31, 2021, these bonds were valued at $176 million. Three months later, on April 3, 2022, Phillips Corporation sold these bonds for $167 million. As part of the multistep approach to record the 2022 transaction, Phillips Corporation should first update the fair value adjustment by recording: An unrealized holding gain of $25 million in 2022. An unrealized holding loss of $9 million in 2022. An unrealized holding gain of $7 million in 2022. A gain of $7 million in 2022.