Problem 15-14 (AICPA Adapted) . On January 1, 2020, Jerome Company purchased nontrading equity investments which are irrevocably designated a FVOCI: Market value December 31, 2020 Purchase Transaction price cost Security A Security B Security C 1,000,000 2,000,000 4,000,000 100,000 200,000 400,000 1,500,000 2,400,000 4,700,000 On July 1, 2021, the entity sold Security C for P5,200,000. What amount of gain on sale should be recognized in th income statement for 2021? 800,000 b. 500,000 300,000 d. а. с.
Q: Answer should be presented as: DECREASE 123456 or INCREASE 123456 During 2021, the first year of…
A: Market value of security 2 as on Dec. 31, 2022 1100000 Less: value at which security 2sold…
Q: During 2021, the first year of operations, Dejavu Company purchased the following equity securities:…
A: As per IFRS 9, a Financial instrument, the financial asset held for trading is measured at fair…
Q: has equity securities designated as at fair value Hilton, Inc. through profit or loss that were…
A: Ans. When securities designated as at fair value through profit n loss account, any changes i.e.…
Q: At the beginning of 2019, Able Company had the following portfolio of investments in trading…
A:
Q: 1. Arizona Company acquired a financial asset not held for trading during the last quarter of the…
A: A) First to Calculate the Stock Value Stock Value = Number of Shares * Cost per Share JFC Stock…
Q: Answer should be presented as: DECREASE 123456 or INCREASE 123456 :During 2021, the first year of…
A: The process of recording business transactions in the books of accounts for the first time is known…
Q: Pompey Inc. carries the following marketable equity securities on its books at December 31, 2021 and…
A: Trading securities won't be fair valued through OCI since they are held for the purpose of trading.…
Q: be held as investments. The cost and market value of the Splendid Company purchased equity…
A: Trading securities are the investments made by an entity with an intention to make profits in the…
Q: Pompey Inc. carries the following marketable equity securities on its books at December 31, 2019 and…
A: Fair value of Financial asset @ FVOCI at 12/31/2020 P50,00,000 Fair value of Financial asset @…
Q: At the beginning of 2019, Ace Company had the following portfolio of investments in…
A: Unrealised gain or loss is the difference between fair value of securities as on reporting date and…
Q: During 2019, XYZ Co. purchased marketable equity securities to be measured at fair value thru other…
A: Fair value through other comprehensive income represents the unrealized profit or loss from the…
Q: Atlas Company purchased the following investments during 2020: Classification Cost Market Value…
A: SOLUTION- ATLAS CO FOR THE YEAR ENDED 2020- SECURITY A OF COST = P900000 MARKET VALUE OF A =…
Q: On January 1, 2021, Jeremiah Company purchased trading equity investments which are irrevocably…
A: Unrealized profit or losses refer to profits or losses that have not occurred in actual but has…
Q: Current Attempt in Progress Some of Sunland Corporation's investments in debt securities are…
A: Existing balances in : Fair value adjustment - Trading account = $2,100 debit Fair value adjustment…
Q: On January 1, 2021, Jeremiah Company purchased trading equity investments which are irrevocably…
A: Financial assets are recognized at their historical costs in initial measurement and the difference…
Q: During 2021, the first year of operations, Beneath Company purchased the following equity…
A: The process of recording business transactions in the books of accounts for the first time is known…
Q: In 2019, Josiah Company purchased nontrading equity in investments which are irrevocably designated…
A: Answer: As per IFRS 9, Financial instruments, there are two different methods for classification of…
Q: Paul Company presented the following information pertaining to its investments in equity securities.…
A: Note: Hi! Thank you for the question As per the honor code, We’ll answer the first question since…
Q: 11. Adam Corporation purchased debt securities during 2021 and classified them as securities…
A: Solution: Securities classified as available for sale is reported at fair value at year end and any…
Q: On December 31, 2019, Belle Company appropriately reported a P100,000 unrealized loss. There was no…
A: Cost Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…
Q: On January 1, 2021, Jeremiah Company purchased trading equity investments which are irrevocably…
A: Income statement is the financial statement that shows income and expenditure. It is also known as…
Q: Stanley Dodge Corporation bought several marketable securities during 2020. At December 31, 2020,…
A: Securities purchased as available for sale indicate those investments which are neither trading…
Q: During 2020, Carpenters Corporation purchased equity securities and carried them at fair value…
A: Fair value: It implies to the actual price that is to be received by the seller on selling it's…
Q: Co. acquired equity securities on May 25, 2020. The acquisition did not result nificant influence…
A: Solution: When acquistion did not result into significant influence over investee company,…
Q: At the beginning of 2019, Ace Company had the following portfolio of investments in…
A: Available-for-sale securities: These are the investment in securities that are intended to be sold…
Q: At December 31, 2020, the available-for-sale debt portfolio for Steffi Graf, Inc. is as follows.…
A: Income statement: The financial statement which reports revenues and expenses from business…
Q: At the beginning of 2019, Ace Company had the following portfolio of investments in…
A: FASB indicates a non-profit private orientation that is engaged in providing guidelines to deal with…
Q: At the beginning of 2019, Ace Company had the following portfolio of investments in…
A: Unrealized loss occurs when a stock decreases after an investor buys it, but yet has to sell it. If…
Q: At December 31, 2020, the available-for-sale debt portfolio for Steffi Graf, Inc. is as follows.…
A:
Q: On January 1, 2020, Erika Company purchased equity investments held for trading. Purchase Price…
A: Accounting for Equity securities: FVTNI Classified as Fair Value through net income ( FTVNI ) -…
Q: Problem 15-10 (AICPA Adapted) During 2021, Haggard Company purchased marketable equity securities…
A: Introduction:- An income statement is a financial statement that summarises a company's income and…
Q: Cloud 9 Inc. has equity securities designated as at fair value through profit or loss that were…
A: Investment in securities means where the company purchased the share or other securities of other…
Q: On December 21, 2020, Buffalo Company provided you with the following information regarding its…
A: The question is based on the concept of Financial Accounting.
Q: On January 1, 2019 an entity acquired non-trading equity securities irrevocably elected at FVOCI…
A: Available for sale securities are the financial instruments held by a company for a period between 1…
Q: At the beginning of 2019, Ace Company had the following portfolio of investments in…
A: The question is based on the concept of Financial Accounting.
Q: Gain or Loss on Sale of FVPL 13) On January 1, 2020, Erika Company purchased equity investments held…
A: Investment held for trading is the investment held with the intent of selling within a limited…
Q: At the beginning of 2019, Ace Company had the following portfolio of investments in…
A: Journal entry : It is prepared to record the financial and non financial transaction of the business…
Q: On March 1, 2020, WHITE Corporation purchased bonds with face amount of P5,000,000. The entity paid…
A: As per IFRS 9, An investment in the financial asset is made to earn the contractual cash flows and…
Q: In 2019, Josiah Company purchased nontrading equity in investments which are irrevocably designated…
A: Recognized Gain - It is the amount when investment is sold and generate amount that is greater than…
Q: Fair value December 31, 2020 Cost Aura Company ordinary Bora Company preference Cara Company bonds…
A: Journal entries in the book of Spark Company (2020) Date Particular Dr. Cr. 01.01.2020…
Q: City Company purchased the following portfolio of equity securities during 2020 and the company has…
A: Debt and Equity Investments: These are also called available‐for‐sale securities and valued at fair…
Q: During 2019, the first year of operation, Maly Corporation made various investments in trading…
A: Unrealised loss on trading securities means when market value or fair value is less than cost value…
Q: At the beginning of 2019, Ace Company had the following portfolio of investments in…
A: Journal entries : Date Accounts title & Explanation Debit $ Credit $ May 3…
Q: 12. On July 1,2020, Ward Company purchased 5,000 of the P1.000 face value, 8 bonds of Jury Company…
A:
Q: Abednego Company purchased equity investments held for trading on January 1, 2020. Purchase Price…
A: The securities which are held by the companies for trading purposes are to be recorded on the fair…
Q: 39. D On January 1, 2019, Caraga Company purchased equity securities to be held as financial assets…
A: At every accounting period, all equity securities are revalued to find out their market value. Then…
Q: Lopez Company purchased equity securities during 2020 to be held as Investment. The cost and Market…
A: Answer - Journal Entry for 2020 - Date Particulars Debit Credit 12.31.2020 Trading…
Q: At December 31, 2020, the available-for-sale debt portfolio for Ivanhoe, Inc. is as follows.…
A: The question is based on the concept of Financial Accounting.
Q: On December 21, 2020, Bucky Katt Company provided you with the following information regarding its…
A: Investment: It refers to the process of using the currently held excess cash to earn profitable…
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
- 4. An entity acquired an investment in equity instrument for P800,000 on 31 March 2020. The direct acquisition costs incurred were P140,000. On 31 December 2020 the fair value of the instrument was P1,100,000 and the transaction costs that would be incurred on sale were estimated at P120,000. If the investment is designated as FA@FVTOCI, what gain would be recognized in the financial statements for the year ended 31 December 2020? Group of answer choices Nil P40,000 P160,000 P420,000Atlas Company purchased the following investments during 2020: Classification Cost Market Value December 31, 2020 Security A Trading 900,000 1,000,000 Security B Trading 1,000,000 1,600,000 On July 31, 2021, the entity sold all of the shares of Security B for P1,100,000. On December 31. 2021, the shares of Security A had a market value of P600,000. No other activity occurred during 2021 in relation to the trading security portfolio. 14. What total loss on the trading securities should be reported in the income statement for 2021? a. 400,000 c. 500,000 b. 900,000 d. 100,000#9 YOO-YOO Corporation has the following investment which was held throughout 2021–2022: Fair Value Cost 12/31/21 12/31/22 Equity investment $836000 $1128000 $1060000 What amount of gain or loss would YOO-YOO Corporation report in its income statement for the year ended December 31, 2022, related to its investment, if the fair value method of accounting was used? $292000 gain. $68000 loss. $68000 gain. $224000 gain.
- 24. When preparing a draft of its December 31, 2020 balance sheet. Era Joy reported net assets totaling P50,000,000. Included is the asset section of the balance sheet were: • Treasury stock of Era Joy Company at cost, which approximates market value on December 31, P5,000,000 • Property no longer adopted for use in business, P1,000,000 • Cash surrender value, P500,000 • Allowance for unrealized loss on noncurrent equity investments, P1,500,000 • Computer software, P4,000,000 At what amount, should the net assets be reported on December 31, 2020?38. On October 1, 2021, a company declared to its shareholders a property dividend in the form of pieces of equipment with carrying amount of P960,000 (acquired on October 1, 2015 for P2,400,000). The dividends are for distribution on January 31, 2022. The company provided the following estimate of the asset’ fair value: October 1, 2021 P1,050,000 December 31, 2021 1,020,000 January 31, 2022 1,110,000 What amount will be reported in 2021 statement of profit or loss as a result of the foregoing transactions?Difficult Company acquiredan equity instrument for P3,600,000 on March 31, 2020 to be measured at fair value through other comprehensive income. The direct costs incurred amounted to P630,000. On December 31, 2020, the fair value of the instrument was P4,950,000 and the transaction costs that would be incurred on the sale of the investment were estimated at P540,000. What amount of unrealized gain or loss on these securities should be reported in other comprehensive income for the year 2020?
- An entity acquired an investment in equity instrument for P800,000 on 31 March 2020. The direct acquisition costs incurred were P140,000. On 31 December 2020 the fair value of the instrument was P1,100,000 and the transaction costs that would be incurred on sale were estimated at P120,000. If the investment is designated as FA@FVTOCI, what gain would be recognized in the financial statements for the year ended 31 December 2020? a. Nilb. P40,000 c. P420,000 d. P160,000An entity acquired an investment in equity instrument for P800,000 on 31 March 2020. The direct acquisition costs incurred were P140,000. On 31 December 2020 the fair value of the instrument was P1,100,000 and the transaction costs that would be incurred on sale were estimated at P120,000. If the investment is designated as FA@FVTOCI, what gain would be recognized in the financial statements for the year ended 31 December 2020? A. Nil B. 40,000 C. 160,000 D. 420,0001. What is the gain on remeasurement to equity to be recognized for 2021?a. 1,500,000b. 4,500,000c. 2,250,000d. 0 2. What is the goodwill arising from the acquisition on January 1, 2021?a. 2,250,000b. 1,250,000c. 1,350,000d. 350,000 3. What is the carrying amount of the investment in associate on December 31, 2021?a. 11,250,000b. 11,800,000c. 12,000,000d. 14,300,000
- In 2019, Josiah Company purchased nontrading equity in investments which are irrevocably designated at FVOCI: Purchased Price Transaction Cost Market Value on Dec. 31, 2019Security A 1,500,000 120,000 1,800,000Security B 2,200,000 190,000 3,000,000Security C 3,500,000 250,000 4,000,000 On March 15, 2020, the entity sold Security A for 2,500,000.What amount of gain on sale should be received in the income statement for 2020? choices 800,000 500,000 300,000 0On January 1, 2020, Marshall acquired an investment for P500,000 plus a purchase commission of P10,000. The investment is designated as financial asset at fair value through other comprehensive income. On December 31, 2020, quoted market price of the investment is P500,000. If the investment were sold, a commission of P15,000 would be paid. On December 31, 2020, the investment should be carried at A.P485,000B.P500,000C.P495,000D.P510,00023 The Phoenix Company accounts for non-current assets using the revaluation On 30 June 2020 Phoenix classified a non-current asset as held for sale in accordance with PFRS5. At that date the property's carrying amount was P300,000 and the balance on the revaluation reserve was P30,000. Fair value was estimated at P280,000 and the costs to sell at P20,000. The value in use is not determinable. The asset is still unsold at 31 December 2020. What amount should be included in the entity's statement of profit or loss for the year ended 31 December 2020?