Stoll Company's long-term available-for-sale portfolio at the start of this year consists of the following. Available-for-Sale Securities Cost Fair Value $ 494,000 Company A bonds Company B notes $ 530,800 159,470 152,000 Company C bonds 661,900 647,730 Stoll enters into the following transactions involving its available-for-sale debt securities this year. January 29 Sold one-half of the Company B notes for $78,810. July 6 Purchased Company X bonds for $124,000. November 13 Purchased Company Z notes for $267,100. December 9 Sold all of the Company A bonds for $517,200. Fair values at December 31 are B, $85,000; C, $604,500; X, $119,000; and Z, $279,000. Problem 15-3A (Algo) Part 3 3. What amount of gains or losses on transactions relating to long-term investments in available-for-sale debt securit does Stoll report on its income statement for this year? Loss Answer is not complete.

Stoll Company's long-term available-for-sale portfolio at the start of this year consists of the following. Available-for-Sale Securities Cost Fair Value $ 494,000 Company A bonds Company B notes $ 530,800 159,470 152,000 Company C bonds 661,900 647,730 Stoll enters into the following transactions involving its available-for-sale debt securities this year. January 29 Sold one-half of the Company B notes for $78,810. July 6 Purchased Company X bonds for $124,000. November 13 Purchased Company Z notes for $267,100. December 9 Sold all of the Company A bonds for $517,200. Fair values at December 31 are B, $85,000; C, $604,500; X, $119,000; and Z, $279,000. Problem 15-3A (Algo) Part 3 3. What amount of gains or losses on transactions relating to long-term investments in available-for-sale debt securit does Stoll report on its income statement for this year? Loss Answer is not complete.

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

Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable

Section: Chapter Questions

Problem 7P: Wilbury Corporation issued 1 million of 13.5% bonds for 985,071.68. The bonds are dated and issued...

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es Required information [The following information applies to the questions displayed below.] Stoll Company's long-term available-for-sale portfolio at the start of this year consists of the following. Fair Value $ 490,000 152,000 640, 190 Available-for-Sale Securities Company A bonds Company B notes Company C bonds Cost $ 533,600 159, 230 662,000 Stoll enters into the following transactions involving its available-for-sale debt securities this year. January 29 Sold one-half of the Company B notes for $78,640. July 6 Purchased Company X bonds for $126,900. November 13 Purchased Company Z notes for $267,900. December 9 Sold all of the Company A bonds for $521,600. Fair values at December 31 are B, $83,900; C, $605,200; X, $107,000; and Z, $275,000. Required: 1. Prepare journal entries to record these transactions, including the December 31 adjusting entry to record the fair value adjustment for the long-term investments in available-for-sale securities. 2. Determine the amount Stoll…
Adjusting AFS Debt Securities to Fair Value A portfolio of investments of available-for-sale securities held by Dow Inc. is as follows. Dec. 31, 2020 Cost Fair Value Eastern Corp. bonds $204,000 $217,600 Western Corp. bonds 340,000 348,500 Total $544,000 $566,100 Dec. 31, 2021 Cost Fair Value Eastern Corp. bonds $204,000 $238,000 Western Corp. bonds 340,000 323,000 Total $544,000 $561,000 The Fair Value Adjustment account had a $0 balance on January 1, 2020. No sales or purchases took place in the available-for-sale investment portfolio in 2020 and 2021. a. Record the adjusting entry on December 31, 2020, to adjust the debt investments to fair value. Date Account Name Dr. Cr. Dec. 31, 2020 b. Record the adjusting entry on December 31, 2021, to adjust the debt investments to fair value. . Date Account Name Dr. Cr. Dec. 31, 2021 c. Indicate how the adjustment to fair value in (b) would be…
Adjusting AFS Debt Securities to Fair Value A portfolio of investments of available-for-sale securities held by Dow Inc. is as follows. Dece. 31, Year 1 Cost Fair Value Eastern Corp. bonds $240,000 $256,000 Western Corp. bonds 400,000 410,000 Total $666,000 $640,000 Dece. 31, Year 2 Cost Fair Value $280,000 Eastern Corp. bonds $240,000 Western Corp. bonds 400,000 380,000 Total $640,000 $660,000 The Fair Value Adjustment account had a $0 balance on January 1 of Year 1. No sales or purchases took place in the available-for-sale investment portfolio in Year 1 and Year 2. a. Record the adjusting entry on December 31 of Year 1 to adjust the debt investments to fair value. b. Record the adjusting entry on December 31 of Year 2 to adjust the debt investments to fair value. Date a. Dec. 31, Year 1 b. Dec. 31, Year 2 Account Name To record adjusting entry. To record adjusting entry. Amount in income statement Net gain (loss) on investment $ Dr. c. Indicate how the adjustment to fair value in…
-k A 0 nces Smith Co.'s long-term available-for-sale portfolio at the start of this year consists of the following. Available for Sale Securities Cost $ 576,530 163,300 Fair Value $ 498,150 Company A bonds Company B notes 159,750 Company C bonds. 641,750 723,930 Smith enters into the following transactions involving its available-for-sale debt securities this year. January 29 July 6 November 13 Sold one-half of the notes of Company B for $80,940. Purchased bonds of Company X for $126,800. Purchased notes of Company 2 for $210,000. December 9 Sold all of the bonds of Company A for $564,999. Fair values at December 31 are: B, $83,300; C.$646,000; X, $119,000; and Z. $217,000. Requirement General Journal Fair Value Transaction Adjustment Analysis Prepare journal entries to record each of the transactions and events. Prepare the year-end adjustment to fair value, if a View transaction list General Ledger Journal entry worksheet < Trial Balance Note: Enter debits before credits. 5 Using the…
Required information Problem 15-2A (Algo) Recording, adjusting, and reporting available-for-sale debt securities LO P3 [The following information applies to the questions displayed below.] Mead Incorporated began operations in Year 1. Following is a series of transactions and events involving its long-term debt investments in available-for-sale securities. Year 1 January 20 Purchased Johnson & Johnson bonds for $24,000. February 9 Purchased Sony notes for $58,590. June 12 Purchased Mattel bonds for $44,000. December 31 Fair values for debt in the portfolio are Johnson & Johnson, $25,700; Sony, $48,450; and Mattel, $56,050. Year 2 April 15 Sold all of the Johnson & Johnson bonds for $27,000. July 5 Sold all of the Mattel bonds for $38,300. July 22 Purchased Sara Lee notes for $16,300. August 19 Purchased Kodak bonds for $17,750. December 31 Fair values for debt in the portfolio are Kodak, $18,550; Sara Lee, $15,500; and Sony, $63,000. Year 3 February 27 Purchased Microsoft bonds for…
! Required information Problem 15-2A (Algo) Recording, adjusting, and reporting available-for-sale debt securities LO P3 [The following information applies to the questions displayed below.] Mead Incorporated began operations in Year 1. Following is a series of transactions and events involving its long-term debt investments in available-for-sale securities. Year 1 January 20 Purchased Johnson & Johnson bonds for $24,500. February 9 Purchased Sony notes for $59,040. June 12 Purchased Mattel bonds for $44,500. December 31 Fair values for debt in the portfolio are Johnson & Johnson, $26,300; Sony, $49,750; and Mattel, $54,550. Year 2 April 15 Sold all of the Johnson & Johnson bonds for $27,500. July 5 Sold all of the Mattel bonds for $38,650. July 22 Purchased Sara Lee notes for $16,700. August 19 Purchased Kodak bonds for $18, 100. December 31 Fair values for debt in the portfolio are Kodak, $18,725; Sara Lee, $16,000; and Sony, $62,000. Year 3 February 27 Purchased Microsoft bonds for…
KNG 202 On its December 31, 2020 balance sheet, Calhoun Company appropriately reported a $10,000 composition of Calhoun's portfolio of debt investments held as available-for-sale debt securities. debit balance in its Fair Value Adjustment account. There was no change during 2021 in the The following information pertains to that portfollo: Security X Y N Cost $130,000 100,000 175,000 $405.000 Fair value at 12/31/21 $160,000 90,000 125,000 $375,000 The amount of unrealized loss to appear as a component of comprehensive income for the year ending December 31, 2021 is a. $40,000. b. $30,000. c. $20,000, d. $0. Bella Pool Company sells prefabricated pools that cost $80,000 to customers for $144,000. The sales price includes an installation fee, which is valued at $20,000. The fair value of the pool is $128,000. The installation is considered a separate performance obligation and is expected to take 3 months to complete. The transaction price allocated to the pool and the installation is a.…
View Policies Current Attempt in Progress If bonds with a face value of $124000 are converted into common stock when the carrying value of the bonds is $118000, the entry to record the conversion will include a debit to O Bonds Payable equal to the market price of the bonds on the date of conversion. O Bonds Payable for $124000. O Discount on Bonds Payable for $6000. O Bonds Payable for $118000. eTextbook and Media Save for Later Attempts: 0 of 2 used Submit Answer 4 5 6 7 8 9 e C b n
Wilbury Corporation issued 1 million of 13.5% bonds for 985,071.68. The bonds are dated and issued October 1, 2019, are due September 30, 2020, and pay interest semiannually on March 31 and September 30. Assume an effective yield rate of 14%. Required: 1. Prepare a bond interest expense and discount amortization schedule using the straight-line method. 2. Prepare a bond interest expense and discount amortization schedule using the effective interest method. 3. Prepare adjusting entries for the end of the fiscal year December 31, 2019, using the: a. straight-line method of amortization b. effective interest method of amortization 4. If income before interest and income taxes of 30% in 2020 is 500,000, compute net income under each alternative. 5. Assume the company retired the bonds on June 30, 2020, at 98 plus accrued interest. Prepare the journal entries to record the bond retirement using the: a. straight line method of amortization b. effective interest method of amortization 6. Compute the companys times interest earned (pretax operating income divided by interest expense) for 2020 under each alternative.
TB MC Qu. 15-99 (Algo) Carpark Services... Carpark Services began operations in 20X1 and maintains investments in available-for-sale debt securities. The year-end cost and fair values for its portfolio of debt securities follows. Available-for-Sale Securities December 31, 20X1 December 31, 20X2 Cost $ 340,000 $ 412,000 Multiple Choice Fair Value $ 344,600 $ 429, 200 The year-end adjusting entry to record the unrealized gain/loss at December 31, 20X2 is: Debit Unrealized Gain - Equity $17,200; Credit Fair Value Adjustment - Available-for-Sale $17,200. Debit Fair Value Adjustment - Available-for-Sale $12,600; Credit Unrealized Loss - Equity $4,600; Credit Unrealized Gain - Equity, $8,000. Debit Fair Value Adjustment - Available-for-Sale $17,200; Credit Unrealized Gain - Equity, $17,200. Debit Fair Value Adjustment - Available-for-Sale $17,200; Credit Unrealized Loss - Equity $17,200. Debit Fair Value Adjustment - Available-for-Sale $12,600; Credit Unrealized Gain Equity $12,600.
Prepare adjusting entry to record fair value, and indicate statement presentation. E16.11 (LO 3), AP Financial Statement Writing At December 31, 2022, available-for-sale debt securities for Storrer, Inc. are as follows. The securities are considered to be a long-term investment. Fair Value $16,000 14,000 21,000 $51,000 Security A B с Cost $17,500 12,500 23,000 $53,000 Instructions a. Prepare the adjusting entry at December 31, 2022, to report the securities at fair value. b. Show the statement presentation at December 31, 2022, after adjustment to fair value. c. E. Kretsinger, a member of the board of directors, does not understand the reporting of the unreal- ized gains or losses. Write a letter to Ms. Kretsinger explaining the reporting and the purposes that it serves.
Current Attempt in Progress Oriole Company has these data at December 31, 2022, the end of its first year of operations. Debt Securities Trading Available-for-sale (a) Cost $120,900 (1) 100,400 The available-for-sale securities are held as a long-term investment. (2) Fair Value $125,900 98,400 Prepare the adjusting entries to report: (1) Trading securities at fair value and (2) Available-for-sale securities at fair value. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts.) No. Account Titles and Explanation Debit Credit