50. Help me selecting the right answer. Thank you Worldwide Enterprises purchased a bond on June 30 of the current year for $100,000 and classified the investment as trading debt. The market value of thetrading debt investment at year-end is $102,500. The adjustment issubtracted from the Trading Debt Investment accountreported as a $2,500 unrealized holding gain in the Other Income and (Expenses) section of the income statementnot reported on the income statement because the market value is greater than the costreported as a separate component of stockholders' equity

The correct answer is: (B) reported as a $2,500 unrealised holding gain in the Other Income and…

Worldwide Enterprises purchased a bond on June 30 of the current year for $100,000 and classified the investment as trading debt. The market value of the trading debt investment at year-end is $102,500. The adjustment is

Worldwide Enterprises purchased a bond on June 30 of the current year for $100,000 and classified the investment as trading debt. The market value of the trading debt investment at year-end is $102,500. The adjustment is

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

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 2MC: During 2021, Anthony Company purchased debt securities as a long-term investment and classified them...

See similar textbooks

Related questions

Q: Nestee controller for Mactan Relaters has assembled the following data to assist in the preparation…

A: Cash budget is prepared to find out the future expected cash inflows and cash outflows so that the…

Q: A trial balance failed to agree because the credit side exceeds the debit side by $2,347. A suspense…

A: The journal entries are prepared to keep the record of day to day transactions of the business on…

Q: Almed Products has determined that the number of machine hours worked (MH) drives the amount of…

A: Manufacturing overhead are all type of indirect expenses being incurred for manufacturing purpose.…

Q: Sharon Incorporated is headquartered in State X and owns 100 percent of Carol Corporation, Josey…

A: ANSWER:- Sharon Carol Josey Janice Sales state x 78,500 18,500 14,300 16,100 total…

Q: can you cash a check from an equity reserve account

A: Equity reserve Equity reserve means the amount of money you can access in the future if you…

Q: Smith Company has issued a $60,000 face value, 10%, five-year bond at 95. What will be the journal…

A: Bonds :Bonds is a long-term debts issued by the government and companies to raise funds for their…

Q: Salmone Company reported the following purchases and sales of its only product. Salmone uses a…

A: Answer to Question:- Cost assigned to cost of goods sold using FIFO=$2,724 Workings:- Total units…

Q: Which statement is incorrect with respect to the number-of-shareholders test in filing an S…

A: The correct answer is: (E) None of the above statements is incorrect. i.e a. Husband Jaime and…

Q: The terms of a will currently undergoing probate are: “A gift to my brother Chris of $40,000 cash;…

A: Demonstrative legacy: A bequest in a will designates a fund from which money or other personal…

Q: I tried the following: Income from continuing Operations before taxes: 330,800 Income Tax…

A: Income from Continuing Operation - Income from Continuing Operations includes those operations of…

Q: The Balance Sheet of Punjab Auto Limited as on 31-12-2002 was as follows: Particular Rs. Particular…

A: The current ratio measures the organization's ability to meet the short-term liabilities due within…

Q: Would the shareholders be happy with the profitability of the company? Use an appropriate…

A: Accounting ratios Accounting ratios, a crucial subset of financial ratios, are a collection of…

Q: Q3. The municipality faced a lot of problems in Alin - Dubai Road accidents. In general, each normal…

A: 1. When two projects or proposal are given for evaluation. Then evaluation should be made from the…

Q: Based on the following information, complete the problems listed below on the Osprey Helicopters…

A: Operating income is the remaining profit of a business,after deducting the operating expenses and…

Q: May is a self-employed business owner. She has 3 employees. She offers medical bakery

A: Insurance premium paid by the employers are tax deductible on the income statments of the employers…

Q: Melanie's partially completed Schedule A, Itemized Deductions, is shown below. Given the adjusted…

A: Medical and Dental Expenses: The deductions are allowed for a taxable year on Form 1040. Taxpayers…

Q: 4.4 Prepare a direct labor budget for each of the upcoming five years. Direct Labor Budget To…

A: The direct labor budget is what's used to figure out how many man-hours will be required to produce…

Q: Please list the two chapters of the bankruptcy law in which a Trustee is appointed. Then list at…

A: Bankruptcy is a situation in which company's assets fell short in compared to its liabilities. There…

Q: The Current Designs staff has prepared the annual manufacturing budget for the rotomolded line based…

A: ANSWER:- CURRENT DESIGNS…

Q: For 20Y2, Tri-Comic Company initiated a sales promotion campaign that included the expenditure of an…

A: Income statement is the financial statement that records all the income and expenses of the business…

Q: During the current year, CF Manufacturing Co. incurred $370,000 of indirect labor costs, $15,000 of…

A: Work in process (WIP) inventory is a term used to describe materials that are being assembled and…

Q: Assume the Hiking Shoes division of the Simply Shoes Company had the following results last year (in…

A: Total assets is the amount owned by the business. Operating income is the income earned from the…

Q: Problem 8-77 (LO 8-5) (Algo) This year Lloyd, a single taxpayer, estimates that his tax liability…

A: Tax Liability The amount that a person, company, or other entity owes to a federal, state or local…

Q: How is the income determined for each shareholder under

A: If any shareholder terminates the shareholder interest in the corporation during taxable year

Q: For each of the following independent cases, fill in the missing amounts in the table: Note:…

A: The variance is the difference between the actual data and standard output of the production. The…

Q: Why would management take extra effort to ensure approximate budgets for direct labor, direct…

A: There are a few reasons why management might take extra effort to ensure approximate budgets for…

Q: Read Section 1361 1. What are the 4 requirements? 2. What Form is used to elect S Corporation?

A: The question is given to explain the 4 requirements of Section 1361. S-corporation: The…

Q: Sales is 160% of Cost of Goods Sold. The company had a profit after tax of (40,000). If tax rate is…

A: The gross profit represents the profit earned by the company before deducting the expenses from the…

Q: Dynamic Software, Inc. invests excess cash of $100,000 in corporate bonds on March 30, 2025. The…

A: In accounting, as per dual aspect every transaction has dual effect on the books of accounts. The…

Q: For the quarter ended March 31, 2020, Croix Company accumulates the following sales data for its…

A: A static budget predicts revenues and costs over a predetermined time period but stays the same…

Q: There are plans to build new connection roads to an antique site to increase tourism into the area.…

A: Initial Cost The initial cost is the sum of the asset's acquisition price plus any expenses…

Q: Required information [The following information applies to the questions displayed below] This year…

A: Every country has its rules and regulations regarding the calculation of taxable income, deductions,…

Q: In 1998, Tamarisk Company completed the construction of a building at a cost of $2,320,000 and first…

A: Journal entry is the primary step to record the transaction in the books of accounts. The…

Q: When an owner of a proprietary business withdraws cash from their personal account to pay for…

A: In proprietary business the owner and business are treated as same. They are not the separate legal…

Q: a. Estimate the fair market value of Torino Marine at the end of 2021. Assume that after 2025,…

A: 1. calculation of Value of company using free cash flows = Free cashflows to company (1- tax rate) /…

Q: The comparative balance sheet of Merrick Equipment Co. for December 31, 20Y9 and 20Y8, is as…

A: Cash flow statement is an important part of financial statement.Cash flow from operating activities…

Q: What advantages do MNEs, as compared to domestic enterprises, have with regards to raising capital,…

A: There has been an increase in the number of multinational firms with the integration of world…

Q: Make the journal entry recorded by Bramble at September 30, 2017 to adjust the portfolio to market?…

A: Investments are recorded in the balance sheet under the head Assets. The investments are recorded at…

Q: Thunder, Inc, has invested in the stock of several corporations and has $500.000 operating income…

A: The dividends received deduction seems to be a federal tax deduction available within the United…

Q: Exercise 9-12 (Algo) Record bonds issued at a premium and related semiannual interest (LO9-5) [The…

A: A journal entry is used to record a business arrangement in the company's accounting records. A…

Q: B. Deferred revenues-rent On September 1, year 1, Noreen Ltd. collected $90,000 in cash from its…

A: Current liability are the financial obligation that the company is expected to meet with in one…

Q: Read Section 1367 1. What items increase shareholder basis?

A: Since you have posted multiple questions we will do the first one for you. To get the other…

Q: The company had no non-current liability. If liabilities is 30% and the capital ending amounted to…

A: Liability is a kind of obligation and debt that an organization and have to pay in the coming period…

Q: During the current year, merchandise is sold for $62,740 cash and for $85,360 on account. The cost…

A: Gross Profit - Gross Profit is the profit earned on the inventory sold to customers. It is…

Q: In 2021 the first year of business, Banton Company had the following transactions: •…

A: Paid-in capital is the money that the company receives from the general public in exchange for the…

Q: Comment on the financial result of the company. Is the company efficient in its collection of…

A: Income statement and balance sheet are treated as the financial statement of a company. Income…

Q: Whitney recurved $77,099 of taxable income in 2022. - she files as head of household. What is the…

A: Taxable income is the income chargeable to income tax as per income tax act. Tax liability is…

Q: Norfolk Sporting Goods purchases merchandise with a catalog list price of $14,200. The retailer…

A: Merchandise transaction are recorded in the companies which they buy and sell inventory items. Some…

Q: Required: What unit values should the company use for each of its products when applying the lower…

A: 1. While valuing the closing inventory, it should be valued at cost or Net realisable value (NRV)…

Question

100%

50. Help me selecting the right answer. Thank you

Worldwide Enterprises purchased a bond on June 30 of the current year for $100,000 and classified the investment as trading debt. The market value of the
trading debt investment at year-end is $102,500. The adjustment is
subtracted from the Trading Debt Investment account
reported as a $2,500 unrealized holding gain in the Other Income and (Expenses) section of the income statement
not reported on the income statement because the market value is greater than the cost
reported as a separate component of stockholders' equity

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Victoria Company has investments in marketable securities classified as trading and available-for-sale. At the beginning of the year, the aggregate market value of each portfolio exceeded its amortized cost. During the year, Victoria sold some securities from each portfolio. At the end of the year, the aggregate amortized cost of each portfolio exceeded its market value. Victoria also has investments in bonds classified as held-to-maturity, all of which were purchased for face value. During the year, some of these bonds held by Victoria were called prior to their maturity by the bond issuer. Three months before the end of the year, additional similar bonds were purchased for face value plus 2 months accrued interest. Required: 1. Explain how Victoria accounts for: a. sale of securities from each portfolio b. each equity securities portfolio at year-end 2. Explain how Victoria accounts for the disposition prior to their maturity of the long-term bonds called by their issuer. 3. Explain how Victoria reports the purchase of the additional similar bonds at the date of the acquisition.
Rekya Mart Inc. is a general merchandise retail company that began operations on January 1, Year 1. The following transactions relate to debt investments acquired by Rekya Mart Inc., which has a fiscal year ending on December 31: Instructions 1. Journalize the entries to record these transactions. 2. If the bond portfolio is classified as available for sale, what impact would this have on financial statement disclosure?
Refer to the information in RE13-5. Assume that on December 31, 2019, the investment in Smith Corporation bonds has a market value of 12,500. Prepare the year-end journal entry to record the unrealized gain or loss.
On September 30, Franz Corporation notices a decline in value of its investment in held-to-maturity bonds. On that date, the carrying value of the bonds is 38,500 and the fair value is 22,980. Franz evaluation of this investment reveals that expected credit losses are 10,000. Prepare the journal entry to record the impairment.
Soto Industries Inc. is an athletic footware company that began operations on January 1, Year 1. The following transactions relate to debt investments acquired by Soto Industries Inc., which has a fiscal year ending on December 31: Instructions 1. Journalize the entries to record these transactions. 2. If the bond portfolio is classified as available for sale, what impact would this have on financial statement disclosure?
Yale Co. purchased a bond on October 4 of the current year for $45,000 and classified it as available-for-sale. The market value of the investment at year-end is $42,000. What value will be reported in net income for the adjustment, if any? a. $42,000 b. $0 c. $(3,000) d. Not enough information is given to determine the amount included in net income.
Complete the following table by putting the proper amount in each column: Assume that $100,000 was invested in each of the following classifications and the market value at the end of the year was $95,000. (For the Current Long term column indicate which classification is correct assuming there are no current maturities on long-term investments) Investment Type Carrying Value Current (C) or Long Term (LT) Adjustment To Income Adjustment to Other Comp Inc Debt Investment Trading Available-For-Sale Held-to-Maturity Equity Investment < 20% Ownership >21%,<50% Ownership
Waterton Corporation reported that short-term investments in debt securities consisted of the following (in millions): Amortized Cost Fair Value December 31 Short-term investments available - for - sale debt securities $1,373.6 $1,373.8 Short-term investments-trading debt securities 161.8 132.0 Total short-term investments $1,535.4 $1,505.8 Which of the following is true? Select one: a. Unrealized losses of $29.8 million on trading securities are included in annual income. b. Waterton's year-end balance sheet includes short-term investments of $1,535.4 million. c. There are no net unrealized gains on available-for-sale securities. d. Accumulated other comprehensive income included no unrealized gains or losses. e. None of these are correct
Use the following information on a company's investments in debt securities to answer the following question. The company's accounting year ends December 31. Investment Date of Acquisition 9/20/23 $38,000 Colt Compan y bonds Cost Fair Value Date Sold Selling 12/31/23 Price $37,000 2/10/24 $42,000 Dana Compan y bonds 10/2/23 14,000 14,200 1/17/24 13,000 If the above investments are categorized as available-for-sale securities, what is the net effect on 2024 other comprehensive income? Select one: a. $ 800 increase b. $0 c. $3,800 increase d. $ 800 decrease
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 these debt securities follows. Available-for-Sale Securities Fair Value $ 323,800 December 31, 20x1 December 31, 20x2 $ 411,600 The year-end adjusting entry to record the unrealized gain/loss at December 31, 20X1 is: Cost $ 320,000 $ 396,000 A
Kitty Company began operations in the current year and acquired short-term debt investments in trading securities. The year-end cost and fair values for its portfolio of these debt investments follow. Trading Securities Tesla Bonds Nike Bonds Ford Bonds (1) After the fair value adjustment is made, prepare the assets section of Kitty Company's December 31 classified balance sheet. (2) In which income statement section is the unrealized gain (or loss) on the portfolio of trading securities reported? Required 1 Cost $ 12,900 21, 200 5,300 Complete this question by entering your answers in the tabs below. Required 2 Fair Value $ 9,675 22,260 4,240 KITTY COMPANY Assets Section of Balance Sheet December 31 Assets After the fair value adjustment is made, prepare the assets section of Kitty Company's December 31 classified balance sheet. Note: Amounts to be deducted should be indicated with a minus sign.
Gecko Investments has the following data regarding their debt investments as of December 31, 2021: Original Cost Amortized Cost Market Value Trading Bonds 95 96 97 Available for Sale Bonds 95 96 97 Held-to-Maturity Bonds 95 96 97 1. What is the total amount of gain or loss to be reported as part of other comprehensive income? Give both the amount and whether it is a gain or loss.