Chap012 Probs - Chapter 12 Reporting and Interpreting...

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Chapter 12 - Reporting and Interpreting Investments in Other Corporations Chapter 12 Reporting and Interpreting Investments in Other Corporations NOTE: I have gone through and made changes to update the answers to be similar to what we covered in class. EXERCISES E12–3. June 30, 2011: Available for Sale Securities (+A) (9,000 shares x $20). ....... 180,000 Cash (–A). ........................................................................... 180,000 Dec. 31, 2011: FV Adj- Avail for Sale Securities (+A). ................................... 36,000 Unrealized holding gain or loss- Equity (+OCI, +SE). ......... 36,000 Dec. 31, 2012: FV Adj- Avail for Sale Securities (+A). .................................... 45,000 Unrealized holding gain or loss- Equity (+OCI, +SE). ........ 45,000 Dec. 31, 2013: Unrealized holding gain or loss- Equity (–OCI, –SE). ............ 27,000 FV Adj- Avail for Sale Securities (–A). ............................... 27,000 Computations: Year Fair Value - Book Value before Adjustment = Amount for Adjusting Entry 2011 $216,000 - $180,000 = +$36,000 2012 261,000 - 216,000 = + 45,000 2013 234,000 - 261,000 = - 27,000 Balance in Net Unrealized Losses/Gains +$54,000 Feb. 14, 2014: Cash (+A) (9,000 shares x $23). ............................................ 207,000 Unrealized holding gain or loss- Equity (–OCI, –SE). ............ 54,000 Available for Sale Securities (–A). ..................................... 234,000 Gain on sale of investment (+Gain, +SE). .......................... 27,000 12-1
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Chapter 12 - Reporting and Interpreting Investments in Other Corporations Note: The net unrealized losses/gains account is a balance sheet account. It does not affect the computation of net income each year. Because it is a balance sheet
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This note was uploaded on 03/07/2012 for the course ACCT 225 taught by Professor Canace during the Spring '08 term at South Carolina.

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Chap012 Probs - Chapter 12 Reporting and Interpreting...

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