Question

 Missing Statement Items, Trading Investments

 JED Capital Inc., makes investments in trading securities. Selected income statement items for the years ended December 31, Year 2 and Year 3, plus selected items from comparative balance sheets, are shown in the income statement and balance sheet below:

 There were no dividends.

 Determine the missing items.

Answer 1

The completed tables are provided as below:

JED Capital Inc.
Selected Income Statement Items
For the Years Ended 31, Year 2 and Year 3
	Year 2	Year 3
Operating Income	$26,000	$13,000
Unrealized Gain (Loss)	12,200	(1,600)
Net Income	$38,200	$11,400

_____

JED Capital Inc.
Selected Balance Sheet Items
December 31, Year 1, Year 2 and Year 3
	Dec. 31, Year 1	Dec. 31, Year 2	Dec. 31, Year 3
Trading Investments, at Cost	$100,200	$118,900	$140,100
Valuation Allowance for Trading Investments	(4,900)	7,300	5,700
Trading Investments, at Fair Value	95,300	126,200	145,800
Retained Earnings	$118,100	$156,300	$167,700

_____

Notes:

The calculations are shown as below:

Income Statement

Net Income (Year 2) = Retained Earnings Year 2 - Retained Earnings Year 1 = 156,300 - 118,100 = $38,200

Unrealized Gain (Loss) (Year 2) = Valuation Allowance for Trading Investments for Year 2 - (- Valuation Allowance for Trading Investments for Year 1) = 7,300 - (-4,900) = $12,200

Operating Income (Year 2) = Net Income for Year 2 - Unrealized Gain (Loss) for Year 2 = 38,200 - 12,200 = $26,900

Operating Income (Year 3) = Net Income for Year 3 - (Unrealized Gain (Loss) for Year 3) = 11,400 - (-1,600) = $13,000

_____

Balance Sheet

Trading Investments at Fair Value (Year 1) = Trading Investments, At Cost for Year 1 - Valuation Allowance for Trading Investment for Year 1 = 100,200 - 4,900 = $95,300

Trading Investments at Fair Value (Year 2) = Trading Investments, At Cost for Year 2 + Valuation Allowance for Trading Investment for Year 2 = 118,900 + 7,300 = $126,200

Valuation Allowance for Trading Investment for Year 3 = Valuation Allowance for Trading Investment for Year 2 + Unrealized Gain (Loss) for Year 3 = 7,300 + (-1,600) = $5,700

Trading Investments at Fair Value (Year 3) = Trading Investments, At Cost for Year 3 - Valuation Allowance for Trading Investment for Year 3 = 140,100 + 5,700 = $145,800

Retained Earnings Year 3 = Retained Earnings for Year 2 + Net Income for Year 3 = 156,300 + 11,400 = $167,700