Question
In: Accounting
Sheridan Inc. has an investment in available-for-sale securities of $64000. This investment experienced an unrealized loss...
Sheridan Inc. has an investment in available-for-sale securities of $64000. This investment experienced an unrealized loss of $5700 during the current year. Assuming a 40% tax rate, the effect of this loss on comprehensive income will be
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Expert Solution
Answer:
Changes in the value of available-for-sale securities create unrealized gains or losses but they are shown in stockholders’ equity and not net income.
Unrealized holding gains or losses are recognized as other comprehensive income for available-for-sale securities.
Hence, comprehensive income will be reduced by $5,700 due to unrealized loss of available-for-sale securities.
ekkarill92 answered 2 years agoRelated Solutions
Sheridan Inc. has an investment in available-for-sale securities of $64000. This investment experienced an unrealized loss...
Sheridan Inc. has an investment in available-for-sale securities
of $64000. This investment experienced an unrealized loss of $5700
during the current year. Assuming a 40% tax rate, the effect of
this loss on comprehensive income will be
Problem 15-3A Debt investments in available-for-sale securities; unrealized and realized gains and losses LO P3 [The...
Problem 15-3A Debt investments in available-for-sale securities;
unrealized and realized gains and losses LO P3
[The following information applies to the questions
displayed below.]
Stoll Co.'s long-term available-for-sale portfolio at the
start of this year consists of the following.
Available-for-Sale Securities
Cost
Fair Value
Company A bonds
$
533,600
$
490,000
Company B notes
159,230
152,000
Company C bonds
662,000
640,190
Stoll enters into the following transactions involving its
available-for-sale debt securities this year.
Jan.
29
Sold one-half of the...
Missing Statement Items, Available-for-Sale Securities Highland Industries Inc. makes investments in available-for-sale securities. Selected income statement...
Missing Statement Items, Available-for-Sale Securities
Highland Industries Inc. makes investments in available-for-sale
securities. Selected income statement items for the years ended
December 31, Year 2 and Year 3, plus selected items from
comparative balance sheets, are as follows:
There were no dividends.
Determine the missing items. If required, use the minus sign to
indicate a net or operating loss, unrealized losses, or a credit
balance in the valuation allowance account.
Highland Industries Inc.
Selected Income Statement Items
For the Years...
Missing Statement Items, Available-for-Sale Securities Highland Industries Inc. makes investments in available-for-sale securities. Selected income statement...
Missing Statement Items, Available-for-Sale Securities
Highland Industries Inc. makes investments in available-for-sale
securities. Selected income statement items for the years ended
December 31, Year 2 and Year 3, plus selected items from
comparative balance sheets, are as follows:
There were no dividends.
Determine the missing items. If required, use the minus sign to
indicate a net or operating loss, unrealized losses, or a credit
balance in the valuation allowance account.
Highland Industries Inc.
Selected Income Statement Items
For the Years...
Stock Investment Transactions, Equity Method and Available-for-Sale Securities Glacier Products Inc. is a wholesaler of rock...
Stock Investment Transactions, Equity Method and
Available-for-Sale Securities
Glacier Products Inc. is a wholesaler of rock climbing gear. The
company began operations on January 1, Year 1. The following
transactions relate to securities acquired by Glacier Products
Inc., which has a fiscal year ending on December 31:
Year 1
Jan. 18.
Purchased 6,300 shares of Malmo Inc. as an available-for-sale
investment at $48 per share, including the brokerage
commission.
July 22.
A cash dividend of $0.50 per share was received...
Stock Investment Transactions, Equity Method and Available-for-Sale Securities Glacier Products Inc. is a wholesaler of rock...
Stock Investment Transactions, Equity Method and
Available-for-Sale Securities
Glacier Products Inc. is a wholesaler of rock climbing gear. The
company began operations on January 1, Year 1. The following
transactions relate to securities acquired by Glacier Products
Inc., which has a fiscal year ending on December 31:
Year 1
Jan. 18.
Purchased 7,900 shares of Malmo Inc. as an available-for-sale
investment at $36 per share, including the brokerage
commission.
July 22.
A cash dividend of $0.45 per share was received...
Stock Investment Transactions, Equity Method and Available-for-Sale Securities Glacier Products Inc. is a wholesaler of rock...
Stock Investment Transactions, Equity Method and
Available-for-Sale Securities
Glacier Products Inc. is a wholesaler of rock climbing gear. The
company began operations on January 1, Year 1. The following
transactions relate to securities acquired by Glacier Products
Inc., which has a fiscal year ending on December 31:
Year 1
Jan. 18.
Purchased 7,300 shares of Malmo Inc. as an available-for-sale
investment at $54 per share, including the brokerage
commission.
July 22.
A cash dividend of $0.60 per share was received...
Stock Investment Transactions, Equity Method and Available-for-Sale Securities Glacier Products Inc. is a wholesaler of rock...
Stock Investment Transactions, Equity Method and
Available-for-Sale Securities
Glacier Products Inc. is a wholesaler of rock climbing gear. The
company began operations on January 1, Year 1. The following
transactions relate to securities acquired by Glacier Products
Inc., which has a fiscal year ending on December 31:
Year 1
Jan. 18.
Purchased 8,000 shares of Malmo Inc. as an available-for-sale
security at $48 per share, including the brokerage commission.
July 22.
A cash dividend of $0.55 per share was received...
Some of Tollakson Corporation’s investment securities are classified as trading securities and some are classified as available-for-sale.
Some of Tollakson Corporation’s investment securities are classified as trading securities and some are classified as available-for-sale. The cost and fair value of each category at December 31, 2017, were as follows.
At December 31, 2016, the Fair Value Adjustment—Trading account had a debit balance of $3,200, and the Fair Value Adjustment—Available-for-Sale account had a credit balance of $5,750. Prepare the required journal entries for each group of securities for December 31, 2017.
Fair Value Journal Entries, Available-for-Sale Investments Hurricane Inc. purchased a portfolio of available-for-sale securities in Year...
Fair Value Journal Entries, Available-for-Sale Investments
Hurricane Inc. purchased a portfolio of available-for-sale
securities in Year 1, its first year of operations. The cost and
fair value of this portfolio on December 31, Year 1, was as
follows:
Name
Number of Shares
Total Cost
Total Fair Value
Tornado Inc.
1,300
$17,420
$19,340
Tsunami Corp.
700
22,960
25,030
Typhoon Corp.
250
7,500
7,130
Total
$47,880
$51,500
On June 12, Year 2, Hurricane purchased 550 shares of Rogue Wave
Inc. at $30...
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