front 1 On January 1, 2016, a company's balance sheet reports its investments in financial instruments as follows: ------------------------------------------------------------------------------- Assets Investment in trading securities: $170,000 Investment in AFS securities: 90,000 Investment in HTM securities: 228,299 Equity Accumulated other comprehensive income: Unrealized gains (losses) on AFS securities: $5,000 ------------------------------------------------------------------------------- Additional information: a. The HTM securities are $220,000 face value debt securities purchased on January 1, 2014, at a yield of 4%. The securities have a 4-year total life and pay interest annually on December 31, at a coupon rate of 6%. b. The trading securities on hand on January 1 were sold in 2016 for $190,000. c. More trading securities were purchased for $110,000. They are still on hand at December 31, 2016, and have a fair value of $115,000. d. AFS securities, originally purchased for $28,000 with a carrying value of $26,000 as of January 1, 2016, were sold for $32,000. e. AFS securities on hand at December 31, 2016, have a fair value of $83,000 The total gain on trading securities reported on the 2016 income statement is... | back 1 $25,000 $190,000 – $170,000 = $20,000 $115,000 – $110,000 = 5,000 Total gain $25,000 |
front 2 On January 1, 2016, a company's balance sheet reports its investments in financial instruments as follows: ------------------------------------------------------------------------------- Assets Investment in trading securities: $165,000 Investment in AFS securities: 95,000 Investment in HTM securities: 217,922 Equity Accumulated other comprehensive income: Unrealized gains (losses) on AFS securities: $4,500 ------------------------------------------------------------------------------- Additional information: a. The HTM securities are $210,000 face value debt securities purchased on January 1, 2014, at a yield of 4%. The securities have a 4-year total life and pay interest annually on December 31, at a coupon rate of 6%. b. The trading securities on hand on January 1 were sold in 2016 for $185,000. c. More trading securities were purchased for $105,000. They are still on hand at December 31, 2016, and have a fair value of $120,000. d. AFS securities, originally purchased for $27,000 with a carrying value of $24,000 as of January 1, 2016, were sold for $32,000. e. AFS securities on hand at December 31, 2016, have a fair value of $85,000 The gain on AFS securities reported on the 2016 income statement is... | back 2 $5,000 $40,000 – $35,000 = $5,000 |
front 3 On January 1, 2016, a company's balance sheet reports its investments in financial instruments as follows: ------------------------------------------------------------------------------- Assets Investment in trading securities: $175,000 Investment in AFS securities: 95,000 Investment in HTM securities: 213,961 Equity Accumulated other comprehensive income: Unrealized gains (losses) on AFS securities: $5,500 ------------------------------------------------------------------------------- Additional information: a. The HTM securities are $210,000 face value debt securities purchased on January 1, 2014, at a yield of 4%. The securities have a 4-year total life and pay interest annually on December 31, at a coupon rate of 5%. b. The trading securities on hand on January 1 were sold in 2016 for $210,000. c. More trading securities were purchased for $115,000. They are still on hand at December 31, 2016, and have a fair value of $130,000. d. AFS securities, originally purchased for $25,000 with a carrying value of $24,000 as of January 1, 2016, were sold for $30,000. e. AFS securities on hand at December 31, 2016, have a fair value of $79,000 Investment in HTM securities reported on the December 31, 2016 balance sheet is... | back 3 $212,019 $213,961 – [(6% x $210,000) – (4% x $213,961)] = $212,019 |
front 4 Under current standards, when is an impairment loss reported on a significant influence investment in the stock of another company, following U.S. GAAP and IFRS? | back 4 U.S. GAAP Other than temporary impairment IFRS Book value > higher of market value or value-in-use |
front 5 Fizzy Cola acquires Juicee Ltd. for $30,000,000 in cash, and accounts for its investment as a merger. Juicee's balance sheet at the date of acquisition is as follows: ------------------------------------------------------------------------------- Current assets $200,000 Liabilities $3,000,000 Property, net 4,100,000 Equity 1,300,000 Total $4,300,000 Total $4,300,000 ------------------------------------------------------------------------------- The fair value of Juicee's current assets is $100,000 less than book value. The fair value of its property is $1,500,000 less than book value. The book value of its liabilities approximates fair value. There are no unreported assets or liabilities. How much goodwill does Fizzy report for this acquisition? | back 5 $30,300,000 Current assets 100,000 Property 2,600,000 Goodwill 30,300,000 Liabilities 3,000,000 Cash 30,000,000 |