Question

E 4-11 Comprehensive income • L04-6 The Massoud Consulting Group reported net income of $1,354,000 for its fiscal year ended December 31, 2021. In addition, during the year the company experienced a positive foreign currency translation adjustment of $240,000 and an unrealized loss on debt securities of $80,000. The company's effective tax rate on all items affecting com- prehensive income is 25%. Each component of other comprehensive income is displayed net of tax. Required: Prepare a separate statement of comprehensive income for 2021.

Answer 1

Solution:

THE MASSOUD CONSULTING GROUP
Statement of comprehensive Income
For the year Ended December 31, 2021
Net Income		13,54,000
Other Comprehensive Income(loss)
Foreign currency translation gain, net of tax [240000 - (240000 *25%)]	180000
Unrealized losses on investment securities Net of tax (80000 x 25%) - 80000	-60000
(180000- 60000)		120000
Total other comprehensive income (1354000 + 120000)		14,74,000