During 2021, the first year of operations, Beneath Company purchased the following equity securities: Cost Market value December 31, 2021 December 31, 2022 Market value Security One Security Two Security Three Security Four 2,200,000 700,000 1,600,000 2,000,000 1,400,000 1,000,000 1,500,000 2,500,000 900,000 1,100,000 1,600,000 1,200,000 Security One and Security Two are held for trading and Security Three and Security Four are measured as at fair value through other comprehensive income by election. During 2022, the entity sold one-half of Security One for P1,000,000, and one-half of Security Four for P1,300,000. Required: Prepare journal entries for 2021 and 2022.

During 2021, the first year of operations, Beneath Company purchased the following equity securities: Cost Market value December 31, 2021 December 31, 2022 Market value Security One Security Two Security Three Security Four 2,200,000 700,000 1,600,000 2,000,000 1,400,000 1,000,000 1,500,000 2,500,000 900,000 1,100,000 1,600,000 1,200,000 Security One and Security Two are held for trading and Security Three and Security Four are measured as at fair value through other comprehensive income by election. During 2022, the entity sold one-half of Security One for P1,000,000, and one-half of Security Four for P1,300,000. Required: Prepare journal entries for 2021 and 2022.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 18E: Trading Securities Pear Investments began operations in 2020 and invests in securities classified as...

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