Homework Answers
Answer to Question 1 : - Opetion (c) Only Realised Gains and Losses
Answer to Question 2 : - Option (a) Debit the Fair Value Adjustment Account for $ 73000
Answer to Question 3 : - Option (a) $ 240,000
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Intermediate Accounting Bus 203 INVESTMENTS REVIEW 1. Which of the following gains and losses on Held-to-maturity...
During 2019 the trading securities portfolio held by the Edelman Corporation consisted of the following investments...
During 2019 the trading securities portfolio held by the Edelman Corporation consisted of the following investments: 1. 2. 2,000 shares of Bauer common stock purchased for $80,000. 1,500 shares of Snow common stock purchased for $60,000. At December 31, 2019, the fair values per share were Bauer $36 and Snow $45. Instructions (a) Prepare a schedule showing the cost and fair value of the portfolio at December 31, 2019. Investment Cost 80,000 60, 6 Oo Fair Value Unrealized Gain /...
Saved Help Save Carpark Services began operations in 20X1 and maintains long-term investments in available-for-sale debt...
Saved Help Save Carpark Services began operations in 20X1 and maintains long-term investments in available-for-sale debt securities. The year end cost and fair values for its portfolio of these debt securities follows. The year-end adjusting entry to record the unrealized gain/loss at December 31, 20X1is: Available-for-Sale Securities Cost Fair Value December 31, 20x1 $300,000 $281,000 December 31, 20x2 $380,000 $401,500 Multiple Choice Debit Unrealized Gain-Equity $19000 Credit Fair Value Adjustment - Available for Sale (LT) $19.000 Debit Unrealized Loss -...
At the beginning of 2019, Ace Company had the following portfolio of investments in available-for-sale debt...
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
$35,000
$44,000
B
53,000
50,000
Totals
$88,000
$94,000
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 $44,000 plus interest of
$1,000.
Dec.
31
Received interest of $1,000 on the...
Carpark Services began operations in 20X1 and maintains long-term investments in available-for-sale securities. The year-end cost...
Carpark Services began operations in 20X1 and maintains long-term investments in available-for-sale securities. The year-end cost and fair values for its portfolio of these investments follow. The year end adjusting entry to record the unrealized gain/loss at December 31, 20X1 is: Available-for-Sale Securities December 31, 20x1 December 31, 20x2 December 31, 20X3 Cost $295,000 $376,000 $446,000 Fair Value $277,000 $396,000 $495,000 Multiple Choice O Debit Unrealized Gain-Equity $18,000: Credit Fair Value Adjustment - Available-for-Sale (LT) $18,000. 0 O Debit Unrealized...
At December 31, 2018, Atlanta Company has an equity portfolio valued at $160,000. Its cost was...
At December 31, 2018, Atlanta Company has an equity portfolio valued at $160,000. Its cost was $132,000. If the Securities Fair Value Adjustment has a debit balance of $8,000, which of the following journal entries is required at December 31, 2018? Select one: a. Fair Value Adjustment 28,000 Unrealized Holding Gain or Loss-Income 28,000 b. Unrealized Holding Gain or Loss-Income 20,000 Fair Value Adjustment 20,000 c. Unrealized Holding Gain or Loss-Income 28,000 Fair Value Adjustment 28,000 d. Fair Value Adjustment...
Feherty, Inc., accounts for its investments under IFRS No. 9 and purchased the following investments during...
Feherty, Inc., accounts for its investments under IFRS No. 9 and purchased the following investments during December 2021: 1. One hundred and ninety of Donald Company's $1,000 bonds. The bonds pay semiannual interest, return principal in 8 years, and Include no other cash flows or other features. Feherty plans to hold 60 of the bonds to collect contractual cash flows over the life of the investment and to hold 130, both to collect contractual cash flows but also to sell...
Which of the following is included in other comprehensive income? 1) Unrealized holding gains and losses...
Which of the following is included in other comprehensive income? 1) Unrealized holding gains and losses on equity securities carried at fair value 2) Unrealized holding gains and losses that result from a debt security being transferred into the trading category from the held-to-maturity category 3)Foreign currency translation adjustments 4) The difference between the accumulated benefit obligation and the fair value of pension plan assets
Situation 1: Goebel Company acquired a 20% interest in Dobbs Company on December 31, 2018 for...
Situation 1: Goebel Company acquired a 20% interest in Dobbs Company on December 31, 2018 for $350,000. During 2019 Dobbs Company had net income of $150,000 and paid a cash dividend of $60,000. (Dobbs Company paid $60,000 cash dividend to all of its shareholders.) 12. Based on the information regarding Goebel's investment in Dobbs Company: Fair Value 12/31/18 12/31/19 $350,000 $365,000 Cost $350,000 Equity investment If the Fair Value Adjustment has a debit balance of $8,000, what amount of unrealized...
Grass Security, which began operations in 2017, invests in long-term available-for-sale securities. Following is a series...
Grass Security, which began operations in 2017, invests in long-term available-for-sale securities. Following is a series of transactions and events determining its long-term investment activity 2017 Jan. 20 Purchased 1,000 shares of Johnson & Johnson at $20.50 per share plus a $240 commission. Feb. 9 Purchased 1,200 shares of Sony at $46.20 per share plus a $225 commission. June 12 Purchased 1,5e0 shares of Mattel at $27.00 per share plus a $195 commission. Dec. 31 Per share fair values for...
Stewart Enterprises has the following investments, all purchased prior to 2018: Bee Company 5% bonds, purchased...
Stewart Enterprises has the following investments, all purchased prior to 2018: Bee Company 5% bonds, purchased at face value, with an amortized cost of $4,000,000, and classified as held to maturity. At December 31, 2018, the Bee investment had a fair value of $3,500,000, and Stewart calculated that $240,000 of the fair value decline is a credit loss and $260,000 is a noncredit loss. At December 31, 2019. the Bee investment had a fair value of $3,700,000, and Stewart calculated...
During 2019 the trading securities portfolio held by the Edelman Corporation consisted of the following investments: 1. 2. 2,000 shares of Bauer common stock purchased for $80,000. 1,500 shares of Snow common stock purchased for $60,000. At December 31, 2019, the fair values per share were Bauer $36 and Snow $45. Instructions (a) Prepare a schedule showing the cost and fair value of the portfolio at December 31, 2019. Investment Cost 80,000 60, 6 Oo Fair Value Unrealized Gain /...
Saved Help Save Carpark Services began operations in 20X1 and maintains long-term investments in available-for-sale debt securities. The year end cost and fair values for its portfolio of these debt securities follows. The year-end adjusting entry to record the unrealized gain/loss at December 31, 20X1is: Available-for-Sale Securities Cost Fair Value December 31, 20x1 $300,000 $281,000 December 31, 20x2 $380,000 $401,500 Multiple Choice Debit Unrealized Gain-Equity $19000 Credit Fair Value Adjustment - Available for Sale (LT) $19.000 Debit Unrealized Loss -...
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
$35,000
$44,000
B
53,000
50,000
Totals
$88,000
$94,000
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 $44,000 plus interest of
$1,000.
Dec.
31
Received interest of $1,000 on the...
Carpark Services began operations in 20X1 and maintains long-term investments in available-for-sale securities. The year-end cost and fair values for its portfolio of these investments follow. The year end adjusting entry to record the unrealized gain/loss at December 31, 20X1 is: Available-for-Sale Securities December 31, 20x1 December 31, 20x2 December 31, 20X3 Cost $295,000 $376,000 $446,000 Fair Value $277,000 $396,000 $495,000 Multiple Choice O Debit Unrealized Gain-Equity $18,000: Credit Fair Value Adjustment - Available-for-Sale (LT) $18,000. 0 O Debit Unrealized...
Feherty, Inc., accounts for its investments under IFRS No. 9 and purchased the following investments during December 2021: 1. One hundred and ninety of Donald Company's $1,000 bonds. The bonds pay semiannual interest, return principal in 8 years, and Include no other cash flows or other features. Feherty plans to hold 60 of the bonds to collect contractual cash flows over the life of the investment and to hold 130, both to collect contractual cash flows but also to sell...
Situation 1: Goebel Company acquired a 20% interest in Dobbs Company on December 31, 2018 for $350,000. During 2019 Dobbs Company had net income of $150,000 and paid a cash dividend of $60,000. (Dobbs Company paid $60,000 cash dividend to all of its shareholders.) 12. Based on the information regarding Goebel's investment in Dobbs Company: Fair Value 12/31/18 12/31/19 $350,000 $365,000 Cost $350,000 Equity investment If the Fair Value Adjustment has a debit balance of $8,000, what amount of unrealized...
Grass Security, which began operations in 2017, invests in long-term available-for-sale securities. Following is a series of transactions and events determining its long-term investment activity 2017 Jan. 20 Purchased 1,000 shares of Johnson & Johnson at $20.50 per share plus a $240 commission. Feb. 9 Purchased 1,200 shares of Sony at $46.20 per share plus a $225 commission. June 12 Purchased 1,5e0 shares of Mattel at $27.00 per share plus a $195 commission. Dec. 31 Per share fair values for...
Stewart Enterprises has the following investments, all purchased prior to 2018: Bee Company 5% bonds, purchased at face value, with an amortized cost of $4,000,000, and classified as held to maturity. At December 31, 2018, the Bee investment had a fair value of $3,500,000, and Stewart calculated that $240,000 of the fair value decline is a credit loss and $260,000 is a noncredit loss. At December 31, 2019. the Bee investment had a fair value of $3,700,000, and Stewart calculated...
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