During the year 2017, Nestle Corp. sold 2,000 shares of Polland Co. for P114,600 and purchased 2,000 moreshares of Lj Inc. and 1,000 shares of Dwarfy Company. On December 31, 2017, Nestle's equity securitiesportfolio consisted of the following:Quantity1,000 shares2,000 shares1,000 shares2,000 sharesInvestmentCostFair valueLj, Ic.Lj, Inc.Dwarfy CompanyAlabang Corp.P45,00099,00048,000216,000P60,000120,00036,00066,000TotalsP408,000P282,000What is the gain or loss on the sale of Polland Co. investment?5,400 gain5,400 loss11,400 gaina.b.С.d.11,400 lossWhat is the carrying amount of the investments on December 31, 2017?408,000444,000c. 282,000d. 246,000ab.What amount of unrealized gain or loss should be reported in the income statement for the year ended December31, 2017?P126,000 unrealized gainP126,000 unrealized lossa.b.P108,000 unrealized gaind. P108,000 unrealized lossс.

Answer 2) As per Ind AS-2, inventory is valued at cost or NRV whichever is lower. This is seen as…

During the year 2017, Nestle Corp. sold 2,000 shares of Polland Co. for P114,600 and purchased 2,000 more shares of Lj Inc. and 1,000 shares of Dwarfy Company. On December 31, 2017, Nestle's equity securities portfolio consisted of the following: Investment Lj, Inc. Lj, Inc. Dwarfy Company Alabang Corp. Totals Quantity 1,000 shares 2,000 shares 1,000 shares 2,000 shares Cost Fair value P45,000 99,000 48,000 216,000 P408,000 P60,000 120,000 36,000 66,000 P282,000 What is the gain or loss on the sale of Polland Co. investment? a. 5,400 gain b. 5,400 loss c. 11,400 gain d. 11,400 loss What is the carrying amount of the investments on December 31, 2017? a. 408,000 b. 444,000 c. 282,000 d. 246,000 What amount of unrealized gain or loss should be reported in the income statement for the year ended December 31, 2017? a. P126,000 unrealized gain b. P126,000 unrealized loss c. P108,000 unrealized gain d. P108,000 unrealized loss

During the year 2017, Nestle Corp. sold 2,000 shares of Polland Co. for P114,600 and purchased 2,000 more shares of Lj Inc. and 1,000 shares of Dwarfy Company. On December 31, 2017, Nestle's equity securities portfolio consisted of the following: Investment Lj, Inc. Lj, Inc. Dwarfy Company Alabang Corp. Totals Quantity 1,000 shares 2,000 shares 1,000 shares 2,000 shares Cost Fair value P45,000 99,000 48,000 216,000 P408,000 P60,000 120,000 36,000 66,000 P282,000 What is the gain or loss on the sale of Polland Co. investment? a. 5,400 gain b. 5,400 loss c. 11,400 gain d. 11,400 loss What is the carrying amount of the investments on December 31, 2017? a. 408,000 b. 444,000 c. 282,000 d. 246,000 What amount of unrealized gain or loss should be reported in the income statement for the year ended December 31, 2017? a. P126,000 unrealized gain b. P126,000 unrealized loss c. P108,000 unrealized gain d. P108,000 unrealized loss

Financial Accounting

14th Edition

ISBN:9781305088436

Author:Carl Warren, Jim Reeve, Jonathan Duchac

Publisher:Carl Warren, Jim Reeve, Jonathan Duchac

Chapter15: Investments And Fair Value Accounting

Section: Chapter Questions

Problem 28E

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NESTLE Inc., invested its excess cash in equity securities during 2016. The business model for these investments is to profit from trading on price changes. (a) As of December 31, 2016, the equity investment portfolio consisted of the following: Investment Lj, Inc. Polland Co. Alabang Corp. Total Quantity 1,000 shares 2,000 shares 2,000 shares Cost P45,000 120,000 216,000 P381,000 Fair Value P63,000 126,000 180,000 P369,000
(b) During the year 2017, Nestle Corp. sold 2,000 shares of Polland Co. for P114,600 and purchased 2,000 more shares of Lj Inc. and 1,000 shares of Dwarfy Company. On December 31, 2017, Nestle's equity securities portfolio consisted of the following: Fair value Investment Lj, Inc. Lj, Inc. Dwarfy Company Alabang Corp. Totals Quantity 1,000 shares 2,000 shares 1,000 shares 2,000 shares Cost P45,000 99,000 48,000 216,000 P408,000 P60,000 120,000 36,000 66,000 P282,000 What is the carrying amount of the investments on December 31, 2017? a.408,000 b. 444,000 282,000 d. 246,000 C.
(b) During the year 2017, Nestle Corp. sold 2,000 shares of Polland Co. for P114,600 and purchased 2,000 more shares of Lj Inc. and 1,000 shares of Dwarfy Company. On December 31, 2017, Nestle's equity securities portfolio consisted of the following: Investment Quantity Cost Fair value Lj, Inc. 1,000 shares P45,000 P60,000 Lj, Inc. 2,000 shares 99,000 120,000 Dwarfy Company 1,000 shares 48,000 36,000 Alabang Corp. 2,000 shares 216,000 66,000 Totals P408,000 P282,000 7. What amount of unrealized gain or loss should be reported in the income statement for the year ended December 31, 2017? a. P126,000 unrealized gain b. P126,000 unrealized loss P108,000 unrealized gain d. P108,000 unrealized loss C.
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6. On 30 June 2017, two-third of the shares of SIC Ltd. (with a total capital of $ 4.800.000) was acquired by HOR Ltd. the Balance Sheet of SIC Ltd. showed a debit balance of $ 2.400.000 on 1st January 2017 and a credit balance of $ 1.440.000 on 31 December 2017. The investment by HOR Ltd. in shares of SIC Ltd. Is $ 3.600.000. Calculate the cost of control or capital reserve. (a) 720000 (b) 620000 (c) 360000 (d) 180000 7. Cash payments to and on behalf of employees is an example of: (a) Cash flow from Operating activities (b) Cash flow from Investing activities (c) Cash flow from Financing activities (d) None of the above 8.Financial Reporting Council is an organisation of which country? (a) The USA (b) The UK (c) Australia (d) Canada
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JOM Co. reported the following information at year-end 2018 2017 Ordinary shares outstanding 360,000 300,000 Nonconvertible preference shares outstanding 10,000 10,000 10% convertible bonds payable - face amount 1.000,000 1,000,000 On September 1, 2018, the entity sold 60.000 additional ordinary shares. Net income for the year ended December 31, 2018 was P6.700,000. con During 2018, the entity paid dividends P30 per share on the nonconvertible preference shares. ons The 10% convertible bonds are convertible into 40 ordinary shares for each P1.000 bond. Unexercised share options to purchase 30,000 ordinary shares at P20 per share were outstanding at the beginning and end of 2018. The average market price ofordinary share was P30 during the current year. ve The market price was P40 on December 31, 2018. Warrants to purchase 20,000 ordinary shares at P45 per share were attached to the preference shares at the time of issuance. The warrants, which expire on December 31, 2020, were…
Kristopher Company began operations in 2014. At 12/31/22, Kristopher had a debit balance of $25,000 in its Allowance for Adjustment to Market. At January 1, 2022, Kristopher owned the following securities, accounted for using the fair value method. Cost MJO Common (25,000 shares) $550,000 JKH Preferred (1,900 shares) 199,500 EKH Common (7,500 shares) 82,500 During 2022 the following events occurred: 4/3/22 Sold 3,000 shares of MJO for $75,000. 9/6/22 Acquired 1,500 shares of WVO Common for $25 per share. At 12/31/22, the fair values for Kristopher’s securities were: MJO Common, $24 per share JKH Preferred, $103 per share EKH Common, $13 per share WVO Common, $27 per share Required: Prepare any journal entries required in 2022 to record the securities activity, including any required adjusting entries at 12/31/22. Show any calculations.…
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