INTERMEDIATE ACCOUNTING
10th Edition
ISBN: 9781264046249
Author: SPICELAND
Publisher: MCG
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Chapter 12, Problem 12.2DMP
1.
To determine
Investment: The act of allocating money to buy a monetary asset, in order to generate wealth in the future is referred to as investment.
Available-for-sale (AFS) securities: These are short-term or long-term investments in debt and equity securities with an intention of holding the investment for some strategic purposes like meeting liquidity needs or manage interest risk.
To Locate: The annual report of a public company that includes the footnote describing the securities available for sale, using the EDGAR in the SEC website.
2.
To determine
To Identify: The caption under which the securities are reported in the comparative balance sheets and to whether they are classified as current or non-current assets.
3.
To determine
To Explain: The method of reporting the realized gains and losses, in the comparative income statement.
4.
To determine
To Explain: The method of reporting the unrealized gains and losses, in the comparative statements and the shareholder’s equity.
5.
To determine
To Explain: Under what head accumulated unrealized gains or losses identifiable in the comparative balance sheets. And the reason for not reporting them in the Income Statement.
6.
To determine
To Explain: The information provided by the changes in the cash flow of these investments in the statement of cash flow.
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Required information
Problem 15-3A (Algo) Debt investments in available-for-sale securities; unrealized and realized gains and
losses LO P3
[The following information applies to the questions displayed below]
Stoll Company's long-term available-for-sale portfolio at the start of this year consists of the following.
Available-for-Sale Securities
Cost
Company A bonds
Company B notes
$530,700
159,250
Fair Value
$ 495,000
151,000
647,710
Company C bonds
661,000
Stoll enters into the following transactions involving its available-for-sale debt securities this year.
January 29 Sold one-half of the Company B notes for $78,000.
July 6 Purchased Company X bonds for $123,600.
November 13 Purchased Company Z notes for $267,900.
December 9 Sold all of the Company A bonds for $518,300.
Fair values at December 31 are B. $84,300; C, $604,800, X, $100,000, and Z, $288,000.
Problem 15-3A (Algo) Part 1 and 2
Chapter 12 Solutions
INTERMEDIATE ACCOUNTING
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Ch. 12 - Under IFRS No. 9, which reporting categories are...Ch. 12 - Prob. 12.12QCh. 12 - Do U.S. GAAP and IFRS differ in the amount of...Ch. 12 - Under what circumstances is the equity method used...Ch. 12 - The equity method has been referred to as a...Ch. 12 - In the application of the equity method, how...Ch. 12 - Prob. 12.17QCh. 12 - Prob. 12.18QCh. 12 - Prob. 12.19QCh. 12 - How does IFRS differ from U.S. GAAP with respect...Ch. 12 - What is the effect of a company electing the fair...Ch. 12 - Define a financial instrument. Provide three...Ch. 12 - Some financial instruments are called derivatives....Ch. 12 - (Based on Appendix 12A) Northwest Carburetor...Ch. 12 - Prob. 12.25QCh. 12 - Prob. 12.26QCh. 12 - (Based on Appendix 12B) Reporting an investment at...Ch. 12 - Prob. 12.28QCh. 12 - Prob. 12.17BECh. 12 - Prob. 12.18BECh. 12 - Prob. 12.20BECh. 12 - Prob. 12.8ECh. 12 - Prob. 12.15PCh. 12 - Prob. 12.2DMPCh. 12 - Prob. 12.4DMPCh. 12 - Continuing Cases Target Case LO12-4, LO12-6...
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