Novak Inc shows on its statement of financial position its investments accounted for as FV-OCI investments. At its year end of May 31, 2022, the balance in the FV-OCI Investments account was $93,500 and at its year end of May 31, 2023, the balance was $125,000. Novak's statement of comprehensive income for the year ended May 31, 2023, shows an unrealized loss from fair value adjustment on FV-OCI investments of $23,800. There were no sales of FV-OCI investments during the year, only purchases. Determine the necessary caption and amount that should appear on Novak's statement of cash flows prepared using the indirect method and determine if the entry appear under the operating, investing, or financing section of the statement. (Show amounts that decrease cash flow with either a-sign eg. 15,000 or in parenthesis e.g. (15,000).)
Novak Inc shows on its statement of financial position its investments accounted for as FV-OCI investments. At its year end of May 31, 2022, the balance in the FV-OCI Investments account was $93,500 and at its year end of May 31, 2023, the balance was $125,000. Novak's statement of comprehensive income for the year ended May 31, 2023, shows an unrealized loss from fair value adjustment on FV-OCI investments of $23,800. There were no sales of FV-OCI investments during the year, only purchases. Determine the necessary caption and amount that should appear on Novak's statement of cash flows prepared using the indirect method and determine if the entry appear under the operating, investing, or financing section of the statement. (Show amounts that decrease cash flow with either a-sign eg. 15,000 or in parenthesis e.g. (15,000).)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Novak Inc. shows on its statement of financial position its investments accounted for as FV-OCI investments. At its year end of May 31,
2022, the balance in the FV-OCI Investments account was $93,500 and at its year end of May 31, 2023, the balance was $125,000.
Novak's statement of comprehensive income for the year ended May 31, 2023, shows an unrealized loss from fair value adjustment on
FV-OCI investments of $23,800. There were no sales of FV-OCI investments during the year, only purchases.
Determine the necessary caption and amount that should appear on Novak's statement of cash flows prepared using the indirect
method and determine if the entry appear under the operating, investing, or financing section of the statement. (Show amounts that
decrease cash flow with either a-sign e.g.-15,000 or in parenthesis e.g. (15,000).)
Investing Activities
Novak Inc.
Statement of Cash Flow (Partial)
For the Year Ended May 31, 2023.
Purchase of Fair Value Through Other Comprehensive income Investments
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