Gen Combo Ll Financial Accounting: Information For Decisions; Connect Ac
9th Edition
ISBN: 9781260260779
Author: Wild
Publisher: MCG
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Chapter C, Problem 17QS
Summary Introduction
Concept Introduction:
Trading securities: these investments are made in securities for the short term, which is held by the investor to sell in the short term to gain a profit on the sale.
To indicate: thereporting of unrealized gain (losses) on trading investment in the income statement.
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Problem 19:
56. On its December 31, 2020 balance sheet, Polo Company reported securities measured at fair value through
other comprehensive income. These securities were acquired at a cost P360,000 and had a year-end fair
value of P330,000. On December 31, 2021, the fair value of the securities was P350,000. What should Polo
report as 2021 income or loss in the profit or loss statement as a result of the change in market value?
Problem 20:
Fastfoods Company acquired the following investments classified as trading securities on August 20, 2020:
Jolibee shares
KFC shares
400,000
250,000
300,000
P
McDonald shares
On December 31, 2020, the close of the year, these investments had the following market values:
Jolibee shares
KFC shares
450,000
220,000
310,000
McDonald shares
57. On February 23, 2021, Fastfoods company sold the KFC shares for P230,000. How much would berecognized
as gain/ (loss) on sale of securities on the sale of the KFC shares as a component of other comprehensive
income?
An entity buys and sells securities expecting to earn profits on short-term differences in price. During 2016, the
entity purchased the following trading securities:
Security
A
Cost
195,000
300,000
660,000
Fair Value Dec. 31, 2016
225,000
162,000
678,000
Before any adjustments related to these trading securities, the entity had net income of P900,000.
What is the entity's net income after making any necessary trading security adjustments?
900,000
810,000
a.
b.
762,000
d. 948,000
C.
What would the net income be if the fair value of security B were P285,000?
a. 867,000
900,000
885,000
933,000
b
C.
d.
Kitty Company began operations in the current year and acquired short-term debt investments in trading securities. The
year-end cost and fair values for its portfolio of these debt investments follow.
Trading Securities
Tesla Bonds
Nike Bonds
Ford Bonds
(1) After the fair value adjustment is made, prepare the assets section of Kitty Company's December 31 classified balance sheet.
(2) In which income statement section is the unrealized gain (or loss) on the portfolio of trading securities reported?
Required 1
Cost
$ 12,900
21, 200
5,300
Complete this question by entering your answers in the tabs below.
Required 2
Fair Value
$ 9,675
22,260
4,240
KITTY COMPANY
Assets Section of Balance Sheet
December 31
Assets
After the fair value adjustment is made, prepare the assets section of Kitty Company's December 31 classified balance sheet.
Note: Amounts to be deducted should be indicated with a minus sign.
Chapter C Solutions
Gen Combo Ll Financial Accounting: Information For Decisions; Connect Ac
Ch. C - Under what two conditions should investments be...Ch. C - Prob. 2DQCh. C - Prob. 3DQCh. C - Identify the three classes of debt investments and...Ch. C - Prob. 5DQCh. C - Prob. 6DQCh. C - Prob. 7DQCh. C - Prob. 8DQCh. C - Prob. 9DQCh. C - Prob. 10DQ
Ch. C - Prob. 11DQCh. C - Prob. 12DQCh. C - Prob. 13DQCh. C - Prob. 14DQCh. C - Which of the following statements a through g are...Ch. C - Prob. 2QSCh. C - Prob. 3QSCh. C - Prob. 4QSCh. C - Prob. 5QSCh. C - Prob. 6QSCh. C - Journ Co. purchased short-term investments in...Ch. C - Prob. 8QSCh. C - Prob. 9QSCh. C - Prob. 10QSCh. C - Prob. 11QSCh. C - Prob. 12QSCh. C - Complete the following descriptions by filling in...Ch. C - Complete the following descriptions by filling in...Ch. C - Prob. 15QSCh. C - Prob. 17QSCh. C - Complete the following descriptions by filling in...Ch. C - Prob. 2ECh. C - Prob. 4ECh. C - Prob. 5ECh. C - Prob. 6ECh. C - Prob. 7ECh. C - Use the following information of Prescrip Co. to...Ch. C - Prob. 9ECh. C - Prob. 10ECh. C - Prob. 12ECh. C - Complete the following descriptions by filling in...Ch. C - Prob. 14ECh. C - Prob. 1PSACh. C - Prob. 3PSACh. C - Prob. 4PSACh. C - Prob. 5PSACh. C - Prob. 6PSACh. C - Prob. 1PSBCh. C - Prob. 3PSBCh. C - Prob. 4PSBCh. C - Prob. 5PSBCh. C - Prob. 6PSBCh. C - Prob. CSPCh. C - Prob. 1GLPCh. C - Prob. 2GLPCh. C - Prob. 1FSACh. C - Prob. 2FSACh. C - Prob. 3FSACh. C - Prob. 2BTN
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