The amortized cost and fair value of debt securities

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Unformatted text preview: s at March 31, 20X5 and 20X4, respectively, while the remainder of trading securities and available-for-sale securities consist primarily of A-rated or higher municipal bond investments. The amortized cost and fair value of debt securities classified as available-for-sale was $3,105,000 and $3,196,000, at March 31, 20X5. The unrealized gain on available-for-sale debt securities is reported, net of tax, as a separate component of shareholders' equity. Arctic Cat Inc. CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY Years Ended March 31, Accumulated Other Comprehensive Income changed by the following amounts: In its 20X4 annual report, Arctic Cat disclosed, "The contractual maturities of available-for-sale debt securities at March 31, 20X4, are $3,573,000 within one year and $3,340,000 from one year through five years." 158.Assume Arctic Cat did not purchase any trading securities during 20X5. Write a journal entry to record any unrealized holding gains or losses on trading securities during 20X5. 159.How much did Arctic Cat actually receive from the sale of available-for-sale securities during 20X5? 160.What gain or loss would be realized if the available for sale securities on Arctic Cat's 3/31/X5 balance sheet were sold immediately for their fair value? Show the journal entry that would record the sale, and show a journal entry to record the effects of the sale on their fair value adjustment at the end of the period (ignore taxes). 161.Prepare the journal entries necessary to account for the Sonny investment, assuming that Fredo accounts for that investment as (1) an available-for-sale investment, and (2) elects the fair-value option. Fredo, Inc., purchased 10% of Sonny Enterprises for $1,000,000 on January 1, 2013. Sonny recognized a total of $400,000 net income during 2013, paid $30,000 of dividends to Fredo during 2013, and at December 31, 2013, the market value of the Sonny investment increased to $1,040,000. Required: 162.Prepare any necessary journal entries for MBH at Decemb...
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This document was uploaded on 07/05/2013.

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