At the end of the first year of operations, the total cost of the trading securities portfolio is $237000. Total fair value is $242000. Thefinancial statements should show an addition to cost of the fair value adjustment andO a realized gain of $5000 in the statement of comprehensive income.a realized gain of $5000 in "Other revenues and gains," on the income statement.O an unrealized gain of $5000 in the stockholders' equity section of the balance sheet.O an unrealized gain of $5000 in "Other revenues and gains," on the income statementD

Trading securities are those securities which are held by the entity sell it within short period of…

At the end of the first year of operations, the total cost of the trading securities portfolio is $237000. Total fair value is $242000. The financial statements should show an addition to cost of the fair value adjustment and O a realized gain of $5000 in the statement of comprehensive income. O a realized gain of $5000 in "Other revenues and gains," on the income statement. O an unrealized gain of $5000 in the stockholders' equity section of the balance sheet. O an unrealized gain of $5000 in "Other revenues and gains," on the income statement D

At the end of the first year of operations, the total cost of the trading securities portfolio is $237000. Total fair value is $242000. The financial statements should show an addition to cost of the fair value adjustment and O a realized gain of $5000 in the statement of comprehensive income. O a realized gain of $5000 in "Other revenues and gains," on the income statement. O an unrealized gain of $5000 in the stockholders' equity section of the balance sheet. O an unrealized gain of $5000 in "Other revenues and gains," on the income statement D

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

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 4C: Victoria Company has investments in marketable securities classified as trading and...

See similar textbooks

Similar questions

(a) Calculate current Ratio and Quick Ratio from the followinginformation:Total Assets Rs. 350000Fixed Assets Rs. 175000Investment Rs. 70000Fictitious Assets Rs. 5000Share holders fund Rs. 200000Long term Debts Rs. 100000Inventory Rs. 45000(b) From the following information calculate the stock turnoverratio.Sales Rs. 200000, G.P 25% on cost, Opening Stock was 1/3rd of thevalue of closing stock. Closing stock was 30% of sales
Abacus Co., provided these data for 2020: Income from continuing operations 4,000,000 800,000 Unrealized gain on financial asset at FVPL Unrealized gain on equity investment at FVOCI 1,000,000 1,200,000 Unrealized loss on debt investment at FVOCI Loss on credit risk a financial liability at FVPL Unrealized gain on futures contract designated as cash flow hedge Net remeasurement gain on a defined benefit plan Translation loss on foreign operation Income from discontinued operations Revaluation surplus 300,000 400,000 600,000 200,000 500,000 2,500,000 How much should be reported as other comprehensive income for 2020?
Consider the financial statements for the REIT given below. Assume that the net revenue includes a loss of $4,000,000 on an asset sale. This REIT has issued 1,000,000 shares. Similar REITs are trading at FFO multiples of 10x. What valuation (share price) does this information imply for the REIT? Net Revenue Less: Less: Interest expense Net income O 49.2 O 129.2 O 95.2 89.2 Operating expenses Depreciation and amortization Income from operations $20,000,000 9,800,000 4,400,000 5,800,000 $ 1,280,000 $ 4,520,000
Topic: REVENUE FROM CONTRACTS WITH CUSTOMERS Requirement: Compute for the transaction price. Assume that the quoted price of the shares remained constant at P20 all throughout the year.
Revenues and operating (marketing and administrative) expenses for the year 2021 are P7,500,000 and P4,000,000 respectively. How much is the change in Retained Earnings for the year 2021 due to the equity securities indicate whether increase or decrease?
Fair value of debt and equity securities portfolio of Band Co. is higher than its cost, inspite of the decrease in value of some securities. At year end, the financial vice presidentand the controller of wwww www the company are about to classify this securities portfolio for the first time. The vice president, who wants to increase net income for the year, proposes to classify the securities that have increased in value as trading. He also proposes to classify the equity securities that have decreased in value as available-for-sale and debt securities that have decreased in value as held-to-maturity. The controller, on the other hand, proposes to classify the securities that have decreased in value as trading . He further propeses to classify the equity securities that have increased in value as available-for-sale and the debt securities that have increased in value as held-to-maturity, Based on the fact that the company has been profitable this year, he states that recognizing losses…
Victoria Company has investments in marketable securities classified as trading and available-for-sale. At the beginning of the year, the aggregate market value of each portfolio exceeded its amortized cost. During the year, Victoria sold some securities from each portfolio. At the end of the year, the aggregate amortized cost of each portfolio exceeded its market value. Victoria also has investments in bonds classified as held-to-maturity, all of which were purchased for face value. During the year, some of these bonds held by Victoria were called prior to their maturity by the bond issuer. Three months before the end of the year, additional similar bonds were purchased for face value plus 2 months accrued interest. Required: 1. Explain how Victoria accounts for: a. sale of securities from each portfolio b. each equity securities portfolio at year-end 2. Explain how Victoria accounts for the disposition prior to their maturity of the long-term bonds called by their issuer. 3. Explain how Victoria reports the purchase of the additional similar bonds at the date of the acquisition.
Below are the ratio results for Abcom for the year 2022. Performance Operating margin -18.66% Asset turnover 0.16 Return on Capital Employed -7.64% Working capital Inventory days 88.88 days Debtor days 46.18 days Trade creditor days 68.11 days Liquidity Current ratio 0.30 Acid test 0.25 Solvency Interest cover -2.56 Shareholder's view Return on equity 7.16% Required; Analyse and interpret the meaning of these results.
At what amount should the following trading investment portfolio be reported on the December 31? balance sheet? All the investments are less than 5 percent of the investee's stock and were purchased late in the current year. Investment Current Stock Cost Market Value ------------------------------------------------------------------------- Eastman Kodak........... $ 5,000 $ 5,500 Exxon................... 61,200 53,000 General Motors.......... 3,680 6,230 The Amounts of the investments on the Balance Sheet is A) $59,222 B) 64,730
It is estimated that entity A will have a net profit of 1.5 USD per share for the next year. Price / Earnings ratio data of this stock for the past 5 years are respectively; It is calculated as 2, 4, 3, 2 and 4. Find the value of the stock of Entity A based on the data? a) 4b) 7.5c) 10d) 6.5e) 9.5 =========== The Price / Earnings ratio of the Alfa company stock has been calculated as 6. If the expected earnings per share of this stock for the next year is 4.5 USD, what is the real value of the stock? a) 40b) 30c) 24d) 35e) 27 ============= Entity X distributed a dividend of $ 12.5 per share last year. If the business is expected to distribute the same amount of dividends in the following years and the minimum return rate expected by the investors is 15%, what is the real value of the stocks of the X entity?a) 48,33b) 36,33c) 83,33d) 25,33e) 64,33
a. Define the equity method b. Use the following example to describe the equity method Presume that Company A bought 30% of Company B’s outstanding common stocks at $400,000 (cash) on 01/01/2020 During 2020, Company B earned net income of $200,000 and paid dividends of $40,000 Provide the journal entries for this equity investment in fiscal year 2020 What is the balance for this equity investment on 12/31/2020? Explain why the accounting numbers obtained using the equity method are misleading
The management of Kosoko traders wants to establish theamount of financial needs for the next two years.Thebalance sheet of the firm as at 31stDecember 2016 is asfollows:Shs.‘000’Net fixed assets 124,800Stock 38,400Debtors 28,800Cash 7,200TotalAssets 199,200Financedby:Ordinary share capital 84,000Retained earnings 35,20012%long-term debt 20,000Trade creditors 36,000Accrued expenses 24,000TOTAL 199,200For the year ended 31st December,2016sales amounted to sh.240,000,000.The firm projects that the sales will increase by15%in 2017and 20% in 2018.After tax profit on sales has been 11% but the management ispessimistic about future operating costs and use anafter-tax profit on sales rate of 8%per annum by 2018.The firmintends to maintain it's dividend pay out ratio 80%.Assets areexpected to vary with sales,while trade creditors and accruedexpenses form the spontaneous sources of financing.Any external financing will be effected through the use of commercial paper.calculate amount of external…