Problems 6 and 7

Problems 6 and 7 - Investments are initially recorded at...

Info iconThis preview shows pages 1–8. Sign up to view the full content.

View Full Document Right Arrow Icon
reporting standards for equity investments Problem 6 and 7
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
FVTPL Investments are initially recorded at FV Each year, revalue investments at FV Dividends and unrealized gains and losses are reported in net income
Background image of page 2
Fair-value-through-OCI Dividends reported in net income and unrealized gains and losses in OCI When sold, clear out previously reported unrealized gains/losses from OCI and report realized gains and losses in Net Income
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Cost Method If market price is not available, cost method is permitted Dividends are recorded in Net Income If permanently impaired, write down the investment and report the loss in Net Income
Background image of page 4
Held-for-significant influence Equity Method:
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Background image of page 6
Background image of page 7

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Background image of page 8
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Investments are initially recorded at cost Reduce the investment by dividends received Increase the investment for your share of the companys profit Held-for-control Investments Consolidated financial statements are required as one company controls another and has the power to direct activities Either cost or equity method is permitted P7: Private Enterprise GAAP Under PEGAAP, investments in associates can be reported at cost or a simplified version of the equity method Non-strategic equity investments will be reported at cost unless the market value is readily available or the entity elects to report at fair value....
View Full Document

Page1 / 8

Problems 6 and 7 - Investments are initially recorded at...

This preview shows document pages 1 - 8. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online