McDonald's Corp purchased the following portfolio of trading securities during 2014 and reported the following balances at December 31, 2014. No sales occurred during 2014. All declines are considered to be temporary. Security
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McDonald's Corp purchased the following portfolio of trading securities during 2014 and reported the following balances at December 31, 2014. No sales occurred during 2014. All declines are considered to be temporary.
Security Cost FMV @ 12/31/2014
X $80,000 $82,000
Y 140,000 132,000
Z 32,000 28,000
The carrying value of the portfolio at 12/31/2014, on McDonald's balance sheet would be:
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- Jaybu Company acquired the following portfolio of equity instruments held for trading during 2022 and reported the following balances at December 31, 2022. No sales occurred during 2022. Security / Cost / Market Value, 12/31/22 AAA Company Shares / 300,000 / 350,000 BBB Company Shares / 450,000 / 410,000 CCC Company Shares / 540,000 / 640,000 DDD Company Shares / 610,000 / 650,000 What is the carrying amount of the securities on December 31, 2022?During 2017, Latvia Company purchased trading securities with the following cost and market value on December 31, 2017. Security Cost Market Value A – 1 000 shares 200 000 300 000 B – 10 000 shares 1 700 000 1 600 000 C – 20 000 shares 3 100 000 2 900 000 5 000 000 4 800 000 The entity sold 10 000 shares of security B on January 15, 2018, for P 150 per share. 1. What amount of unrealized gain or loss should be reported in income statement for 2017? 2. What amount should be reported as loss on sale of trading investment of 2018?Walsh, Inc. began business on January 1, 2002, and at December 31, 2002, Walsh had the following investment portfolios of equity securities: FVPL FVOCI Aggregate cost ₱150,000 ₱225,000 Aggregate fair value 120,000 185,000 None of the declines is judged to be other than temporary. Unrealized losses at December 31, 2002, should be recorded with corresponding charges against Profit or loss Equity Profit or loss Equity 70,000 0 30,000 40,000 40,000 30,000 0 70,000
- Red Company had the following portfolio of equity securities to other comprehensive income at December 31, 2018:Security Cost Market ValueA 400,000 390,000B 700,000 660,000Total 1,100,000 1,050,000If Red Company would have to sell the securities transaction cost will be incurred as follows; P20,000 and P30,000 for security A and B, respectively. In Red's December 31, 2018 statement of financial position, how much should be reported as the carrying value of the portfolio? a. 1,050,000 b. 1,060,000 c. 1,100,000 d. 1,110,000Lexington Co. has the following securities outstanding on December 31, 2017 (its first year of operations). Cost Fair Value Greenspan Corp. stock $20,000 $19,000 Summerset Company stock 9,500 8,800 Tinkers Company stock 20,000 20,600 $49,500 $48,400 During 2018, Summerset Company stock was sold for $9,200, the difference between the $9,200 and the “fair value” of $8,800 being recorded as a “Gain on Sale of Investments.” The market price of the stock on December 31, 2018, was Greenspan Corp. stock $19,900; Tinkers Company stock $20,500.Instructions(a) What justification is there for valuing equity securities at fair value and reporting the unrealized gain or loss as part of net income?(b) How should Lexington Co. report this information in its financial statements at December 31, 2017? Explain.(c) Did Lexington Co. properly account for the sale of the Summerset Company stock? Explain.(d) Are there any additional entries necessary for Lexington Co. at December 31,…Presented below is information relating to the purchase of common stock by Jamison Company December 31, 2016. Cost Fair Value Investment in Readfield Company common stock $125,000 $115,500 Investment in Lee Company common stock $100,000 $ 80,000 Investment in Stern Company common stock $250,000 $300,000 Investment in Jones Company common stock $180,000 $190,000 $655,000 $685,500 These investments are classified as trading security by Jamison who uses portfolio approach to account for those investments. During the year 2017, Lee Company’s stock was sold for $102,000. Jamison purchased common…
- 22. During 2022, Haggard Company purchased marketable equity securities for P 1,850,000 to be held as trading investments. In 2022, the entity appropriately reported an unrealized loss of P 200,000 in the income statement. There was no change during 2022 in the composition of the portfolio of trading securities. Pertinent data on December 31, 2023 are: Security Cost Market value Inc (Dec) A 600,000 700,000 100,000 B 450,000 400,000 (50,000) C 800,000 900,000 100,000 Net Increase 150,000 What amount of unrealized gain on these securities should be included in the 2021 income statement?Fernandez Corp. invested its excess cash in securities during 2020. As of December 31, 2020, the securities portfolio consisted of the following common stocks. Security Quantity Cost Fair Value Lindsay Jones, Inc. 1,000 shares $ 15,000 $ 21,000 Poley Corp. 2,000 shares 40,000 42,000 Arnold Aircraft 2,000 shares 72,000 60,000 Totals $127,000 $123,000 Instructions a. What should be reported on Fernandez's December 31, 2020, balance sheet relative to these securities? What should be reported on Fernandez's 2020 income statement? On December 31, 2021, Fernandez's securities portfolio consisted of the following common stocks. Security Quantity Cost Fair Value Lindsay Jones, Inc. 1,000 shares $ 15,000 $20,000 Lindsay Jones, Inc. 2,000 shares 33,000 40,000 Duff Company 1,000 shares 16,000 12,000 Arnold Aircraft 2,000 shares 72,000 22,000 Totals $136,000 $94,000 During the year 2021,…Bridgeport Corp. invested its excess cash in securities during 2020. As of December 31, 2020, the securities portfolio consisted of the following common stocks. Security Quantity Cost Fair Value Lindsay Jones, Inc. 1,000 shares $15,100 $21,100 Poley Corp. 2,000 shares 39,900 41,800 Arnold Aircraft 2,000 shares 72,500 60,300 Totals $127,500 $123,200 What should be reported on Bridgeport’s December 31, 2020, balance sheet relative to these securities? What should be reported on Bridgeport’s 2020 income statement?
- Purchases of common stock by jamison december 31 2016 Company Invested In Cost Fair Value Readfield 125,000 115,500 Lee 100,000 80,000 Stern 250,000 300,000 Jones 180,000 190,000 These are classified as trading security by jamison, who uses the portfolio approach During 2017 lee company's stock was sold for 102,000 and jamison purchased common stock of earnhart company at a cost of 163,300 at the end of 2017 the fair values of the trading securities are as follows readfield 111,800 stern 310,000 jones 171,600 earnhart 159,250 a) make the adjustment entry for the portfolio at december 31 2016 to report the fair value of investment in the balance sheet b) prepare the journal entry to record the sale of lee company's stock in jamisons book in 2017 c) prepare the journal entry to record the purchase of earnharts's common stock by jamison d) calculate the fair value of the portfolio as of december 31 2017 e) make the adjustment entry for the portfolio at december…Drew Corporation had the following investment portfolios at the end of its first year of operations: Year-End Security Classification Cost Fair Value A Held for Trading ₱18,000 ₱23,000 B Held for Trading ₱25,000 ₱27,000 The year-end adjusting entry would most likely include a ₱11,000 net debit to gain. ₱7,000 net credit to a fair value adjustment account. ₱7,000 net debit to held for trading securities. ₱5,000 net credit to loss.Holly Company invests its excess cash in marketable securities. At the beginning of 2010 it had the following portfolio of investments in available-for-sale securities: 12/31/09 Security Cost Fair Value 400 shares of I Company common stock $ 8,400 $ 9,400 700 shares of O Company common stock 23,100 21,700 Totals $31,500 $31,100 During 2010, the following transactions occurred: Mar. 31 Purchased U Company 8% bonds with a face value of $10,000 for $10,000 plus accrued interest; interest is payable on the bonds each June 30 and December 31 May 17 Sold 200 shares of O Company common stock for $30 per share…
