Problem 15-7 (ACP) Chaplain Company was very active in acquiring and selling investments in equity securities. Data regarding the securities are: Cost Market value December 31, 2020 Trading securities Securities not held for trading 5,000,000 3,000,000 4,600,000 3,100,000 December 31, 2021 Trading securities Securities not held for trading 5,000,000 3,000,000 5,500,000 3,300,000 The entity made an irrevocable election to present changes in fair value of the securities not held for trading in other comprehensive income. Required: Prepare journal entries to recognize the changes in market value for 2020 and 2021.

Problem 15-7 (ACP) Chaplain Company was very active in acquiring and selling investments in equity securities. Data regarding the securities are: Cost Market value December 31, 2020 Trading securities Securities not held for trading 5,000,000 3,000,000 4,600,000 3,100,000 December 31, 2021 Trading securities Securities not held for trading 5,000,000 3,000,000 5,500,000 3,300,000 The entity made an irrevocable election to present changes in fair value of the securities not held for trading in other comprehensive income. Required: Prepare journal entries to recognize the changes in market value for 2020 and 2021.

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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Brief Exercises Journalize entries for debt investments. BEH.1 (LO 1), AP Craig Corporation purchased debt investments for $40,800 on January 1, 2022. On July 1, 2022, Craig received cash interest of $1,660. Journalize the purchase and the receipt of interest. Assume no interest has been accrued. Journalize entries for stock investments. GRANT Docombor 1 the
Q2. The following transactions involving marketable securities investments of Kappa Co., occurred during 2022; a) On Feb. 14, purchased Alfa's 90-day bonds, paying cash of $170,000 (par value $170,000), issue date Feb. 14, that pay 9% interest. b) On March 21, purchased 850 shares of Beta Co. at $21 per share, in cash. c) On May 14, collected the principal and 90-days' interest on the bonds purchased in transaction a. d) On Aug. 1, paid $70,000 cash to Gama Co.'s 12% bonds (par value $70,000), issue date July 31, 2022, and retires January 31, 2023. e) On Sept. 1, Beta Co. declared a $1.80 per share cash dividend on shares payable on Oct.31. f) On Oct. 7, sold 425 shares of Beta Co. and collected totally $10,625. g) On Oct. 31, collected Gama Co.'s 90-days' interest and Beta Co.'s dividends. Required: Prepare the journal entries and post to necessary ledger accounts.
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TB MC Qu. 15-99 (Algo) Carpark Services... Carpark Services began operations in 20X1 and maintains investments in available-for-sale debt securities. The year-end cost and fair values for its portfolio of debt securities follows. Available-for-Sale Securities December 31, 20X1 December 31, 20X2 Cost $ 340,000 $ 412,000 Multiple Choice Fair Value $ 344,600 $ 429, 200 The year-end adjusting entry to record the unrealized gain/loss at December 31, 20X2 is: Debit Unrealized Gain - Equity $17,200; Credit Fair Value Adjustment - Available-for-Sale $17,200. Debit Fair Value Adjustment - Available-for-Sale $12,600; Credit Unrealized Loss - Equity $4,600; Credit Unrealized Gain - Equity, $8,000. Debit Fair Value Adjustment - Available-for-Sale $17,200; Credit Unrealized Gain - Equity, $17,200. Debit Fair Value Adjustment - Available-for-Sale $17,200; Credit Unrealized Loss - Equity $17,200. Debit Fair Value Adjustment - Available-for-Sale $12,600; Credit Unrealized Gain Equity $12,600.
Journal entries for trading investments The investments of Charger Inc. include an investment of trading securities of Raiders Inc. purchased on February 24, 20Y7, for $216,000. The fair value of the securities on December 31, 20Y7, is $288,000. a. Journalize the entries for the February 24 purchase and the adjustment to fair value on December 31, 20Y7. If an amount box does not require an entry, leave it blank. 20Y7 Feb. 24 Accounting numeric field 20Y7 Dec. 31 Feedback Check My Work a. Increase the investment and reduce Cash for number of shares times the per share price. The unrealized gain (credit) or unrealized loss (debit) is the difference between the acquired per share price and the market price per share at 20Y7 taken times the number of shares acquired. The offset account for the gain or loss entry is the valuation allowance account. b. How is a unrealized gain or loss for trading investments reported on the financial statements? 00
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Journal entry worksheet < 1 Record the fair value adjustment assuming the fair value of the IBM common shares was $1,610,000. Note: Enter debits before credits. Transaction 1 Record entry General Journal Clear entry Debit Credit View general journal
Required Information Exercise 12-17 (Algo) Equity investments; fair value through net income [LO12-5] [The following information applies to the questions displayed below.] The accounting records of Jamaican Importers, Incorporated, at January 1, 2024, included the following: Assets: Investment in IBM common shares Less: Fair value adjustment No changes occurred during 2024 in the investment portfolio. $ 1,745, 000 (185, 000) $ 1,560,000 Exercise 12-17 (Algo) Part 3 3. Prepare appropriate adjusting entry(s) at December 31, 2024, assuming the fair value of the IBM common shares was $1,755,000. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. View transaction list