Chicken Wings Company has 60,000 shares of Fried Chicken Company ordinary share as equity investments at fair value through other comprehensive income. These shares were acquired at fair market value, which was P80 per share on May 2, 2022. On December 20, 2022 the market value of these shares is P90/share. On December 22, 2022, Chicken Wings sold 42,000 shares of its investment in Fried Chicken Company for P92/share, which is the current quoted price also in the market, and incurred commission expense of P8,000. Market value of Fried Chicken’s stock has increased by P3 per share by year-end. The company’s policy is to derecognize the related amount in the OCI whenever the investment was disposed. How much was transferred to retained earnings upon sale?
Chicken Wings Company has 60,000 shares of Fried Chicken Company ordinary share as equity investments at fair value through other comprehensive income. These shares were acquired at fair market value, which was P80 per share on May 2, 2022. On December 20, 2022 the market value of these shares is P90/share. On December 22, 2022, Chicken Wings sold 42,000 shares of its investment in Fried Chicken Company for P92/share, which is the current quoted price also in the market, and incurred commission expense of P8,000. Market value of Fried Chicken’s stock has increased by P3 per share by year-end. The company’s policy is to derecognize the related amount in the OCI whenever the investment was disposed. How much was transferred to retained earnings upon sale?
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter16: Retained Earnings And Earnings Per Share
Section: Chapter Questions
Problem 5MC: Kent Corporation was organized on January 1, 2014. On that date, it issued 200,000 shares of 10 par...
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Chicken Wings Company has 60,000 shares of Fried Chicken Company ordinary share as equity investments at fair value through other comprehensive income. These shares were acquired at fair market value, which was P80 per share on May 2, 2022. On December 20, 2022 the market value of these shares is P90/share. On December 22, 2022, Chicken Wings sold 42,000 shares of its investment in Fried Chicken Company for P92/share, which is the current quoted price also in the market, and incurred commission expense of P8,000. Market value of Fried Chicken’s stock has increased by P3 per share by year-end. The company’s policy is to derecognize the related amount in the OCI whenever the investment was disposed. How much was transferred to
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