Pearson eText Intermediate Accounting -- Instant Access (Pearson+)
3rd Edition
ISBN: 9780136946649
Author: Elizabeth Gordon, Jana Raedy
Publisher: PEARSON+
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Chapter 14, Problem 2JC
a.
To determine
The way in which the company should account for financial instrument on the balance sheet under U.S GAAP.
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Students have asked these similar questions
During the course of your examination of the financial statements of Sunland Corporation for the year ended December 31, 2025, you
found a new account, "Investments." Your examination revealed that during 2025, Sunland began a program of investments, and all
investment-related transactions were entered into this account. Your analysis of this account for 2025 follows:
Date-2025
Feb. 14
July
26
Sept.
28
Apr.
Oct. 28
30
Sunland Corporation
Analysis of Investments Account
For the Year Ended December 31, 2025
(a)
Blossom Company Common Stock
Purchased 3,900 shares @ $66 per share.
Received 390 shares of Blossom Company common stock as a stock dividend.
(Memorandum entry in general ledger.)
Sold the 390 shares of Blossom Company common stock received July 26 @ $70 per
share.
(b)
Daniel Inc. Common Stock
Purchased 18,100 shares @ $42 per share.
Received dividend of $1 per share.
Debit
$257,400
$760,200
Credit
$27,300
$18,100
Example 2)
Fair value through profit or loss: Debt investment
ABC Co. had the following transactions pertaining its trading investments:
Feb. 1, 2021
Purchased $200,000 of 3-year, 6% bonds at 104. Interest is payable on each August
1 and February 1.
Aug. 1, 2021
Received interest on the bonds.
Dec. 31, 2021
The fair value of the bonds was 100.
Instruction:
Record the above transactions, using the fair value through profit or loss model. Also, prepare any
required adjusting entry/entries at December 31, 2021. ABC Co. has a December 31 year-end.
Requirement 3. Prepare a comprehensive income statement for Thyme Investments for year ended December 31, 2018. Assume net income was $320,000. (Use a minus sign or parentheses to enter a loss.)
2018
Jan. 5
Purchased Vince Company's $525,000 bond at face value. Thyme classified the investment as available-for-sale. The Vince bond pays interest at the annual rate of 6% on June 30 and December 31 and matures on December 31, 2021 Management's intent is to keep the bonds for several years .
June 30
Received an interest payment from Vince
Dec.31
Received an interest payment from Vince.
Dec.31
Adjusted the investment to its current market value of $518.500 .
Chapter 14 Solutions
Pearson eText Intermediate Accounting -- Instant Access (Pearson+)
Ch. 14 - What conditions or terms does a note payable...Ch. 14 - If the market rate of interest exceeds the face or...Ch. 14 - What is included in bond issue costs and how...Ch. 14 - Prob. 14.4QCh. 14 - When a bond is issued at a discount, will its...Ch. 14 - Prob. 14.6QCh. 14 - Prob. 14.7QCh. 14 - Under IFRS, how do firms account for convertible...Ch. 14 - Prob. 14.9QCh. 14 - Can companies reclassify short-term debt expected...
Ch. 14 - Under IFRS, can companies reclassify short-term...Ch. 14 - Do companies always reclassify long-term debt that...Ch. 14 - Prob. 14.13QCh. 14 - Prob. 14.14QCh. 14 - Prob. 14.15QCh. 14 - Prob. 14.16QCh. 14 - Prob. 14.1MCCh. 14 - Prob. 14.2MCCh. 14 - Prob. 14.3MCCh. 14 - Prob. 14.4MCCh. 14 - Prob. 14.5MCCh. 14 - Clothes Horse Corp. (CHC) Issued 500,000 bonds due...Ch. 14 - Prob. 14.7MCCh. 14 - Prob. 14.8MCCh. 14 - Prob. 14.9MCCh. 14 - Prob. 14.10MCCh. 14 - Prob. 14.11MCCh. 14 - Prob. 14.1BECh. 14 - Notes Payable. Using the information provided in...Ch. 14 - Prob. 14.3BECh. 14 - Prob. 14.4BECh. 14 - Prob. 14.5BECh. 14 - Prob. 14.6BECh. 14 - Bond Terminology. Match each term with its...Ch. 14 - Bond Pricing. Fill in the missing items for each...Ch. 14 - Prob. 14.9BECh. 14 - Bond Issue Price. Using the information from...Ch. 14 - Prob. 14.11BECh. 14 - Prob. 14.12BECh. 14 - Prob. 14.13BECh. 14 - Prob. 14.14BECh. 14 - Prob. 14.15BECh. 14 - Prob. 14.16BECh. 14 - Prob. 14.17BECh. 14 - Prob. 14.18BECh. 14 - Bonds Issued between Interest Payment Dates. For...Ch. 14 - Prob. 14.20BECh. 14 - Prob. 14.21BECh. 14 - Prob. 14.22BECh. 14 - Prob. 14.23BECh. 14 - Prob. 14.24BECh. 14 - Prob. 14.25BECh. 14 - Prob. 14.26BECh. 14 - Prob. 14.27BECh. 14 - Prob. 14.28BECh. 14 - Prob. 14.29BECh. 14 - Prob. 14.30BECh. 14 - Prob. 14.31BECh. 14 - Prob. 14.32BECh. 14 - Prob. 14.33BECh. 14 - Prob. 14.34BECh. 14 - Prob. 14.35BECh. 14 - Prob. 14.36BECh. 14 - Prob. 14.37BECh. 14 - Prob. 14.1ECh. 14 - Prob. 14.2ECh. 14 - Prob. 14.3ECh. 14 - Prob. 14.4ECh. 14 - Prob. 14.5ECh. 14 - Prob. 14.6ECh. 14 - Prob. 14.7ECh. 14 - Prob. 14.8ECh. 14 - Prob. 14.9ECh. 14 - Prob. 14.10ECh. 14 - Prob. 14.11ECh. 14 - Prob. 14.12ECh. 14 - Prob. 14.13ECh. 14 - Prob. 14.14ECh. 14 - Prob. 14.15ECh. 14 - Prob. 14.16ECh. 14 - Warrants. DHC Associates issued 2,100 of its...Ch. 14 - Prob. 14.18ECh. 14 - Prob. 14.19ECh. 14 - Prob. 14.1PCh. 14 - Prob. 14.2PCh. 14 - Prob. 14.3PCh. 14 - Prob. 14.4PCh. 14 - Prob. 14.5PCh. 14 - Prob. 14.6PCh. 14 - Prob. 14.7PCh. 14 - Prob. 14.8PCh. 14 - Prob. 14.9PCh. 14 - Prob. 14.10PCh. 14 - Prob. 14.11PCh. 14 - Prob. 14.12PCh. 14 - Prob. 14.13PCh. 14 - Prob. 1JCCh. 14 - Prob. 2JCCh. 14 - Prob. 3JCCh. 14 - Prob. 1FSCCh. 14 - Prob. 1SSCCh. 14 - Surfing the Standards Case 2: Bonds with...Ch. 14 - Prob. 1BCC
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