The following investment portfolio of equity securities (all acquired during 2021) accounted for as fair value through other comprehensive income are held by GHI Company on December 31, 2021: Investment Acquisition Cost P3,300,000 HJK, Inc. shares (1,100 shares) LMN Co. shares (35,000 shares) OPQ Corp. shares (12,000 shares) Fair value, 12/31/21 P3,100/share 9/share 225/share 350,000 2,400,000 The following transactions occurred during 2022: • A 20% stock dividend was declared and issued on the HJK, Inc. shares, after which the company sold 330 shares at its fair value of P2,700/share. ● Additional 5,000 shares of LMN Co. were purchased by the company during the year at fair value of P9.50/share, excluding P0.50/share transaction costs. LMN Co. then declared and paid a P2/share cash dividend. A 2-for-3 split was declared by OPQ Corp. to reduce its number of shares. OPQ Corp. declared and paid a P3/share cash dividend after the split. The fair value of the equity securities at year-end are as follows: Investment Fair value, 12/31/22 HJK, Inc. shares LMN Co. shares P2,800/share 11/share 320/share OPQ Corp. shares 11) What is the balance of Unrealized Gain or Loss - OCI account on January 1, 2022? (Indicate if debit or credit) 12) What is the total dividend income to be recognized from the investments in 2022? 13) What is the balance of Unrealized Gain or Loss - OCI to be "recycled" to the income statement in 2022? (Indicate if debit or credit) 14) What is the total carrying value of the equity securities on December 31, 2022? 15) The journal entry to update the carrying value of the investments at year-end will include a debit/credit to the investment account of: (Indicate if debit or credit)
The following investment portfolio of equity securities (all acquired during 2021) accounted for as fair value through other comprehensive income are held by GHI Company on December 31, 2021: Investment Acquisition Cost P3,300,000 HJK, Inc. shares (1,100 shares) LMN Co. shares (35,000 shares) OPQ Corp. shares (12,000 shares) Fair value, 12/31/21 P3,100/share 9/share 225/share 350,000 2,400,000 The following transactions occurred during 2022: • A 20% stock dividend was declared and issued on the HJK, Inc. shares, after which the company sold 330 shares at its fair value of P2,700/share. ● Additional 5,000 shares of LMN Co. were purchased by the company during the year at fair value of P9.50/share, excluding P0.50/share transaction costs. LMN Co. then declared and paid a P2/share cash dividend. A 2-for-3 split was declared by OPQ Corp. to reduce its number of shares. OPQ Corp. declared and paid a P3/share cash dividend after the split. The fair value of the equity securities at year-end are as follows: Investment Fair value, 12/31/22 HJK, Inc. shares LMN Co. shares P2,800/share 11/share 320/share OPQ Corp. shares 11) What is the balance of Unrealized Gain or Loss - OCI account on January 1, 2022? (Indicate if debit or credit) 12) What is the total dividend income to be recognized from the investments in 2022? 13) What is the balance of Unrealized Gain or Loss - OCI to be "recycled" to the income statement in 2022? (Indicate if debit or credit) 14) What is the total carrying value of the equity securities on December 31, 2022? 15) The journal entry to update the carrying value of the investments at year-end will include a debit/credit to the investment account of: (Indicate if debit or credit)
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 23P
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