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In: Accounting
Missing Statement Items, Available-for-Sale Securities Oceanic Airways makes investments in available-for-sale securities. Selected income statement items...
Missing Statement Items, Available-for-Sale Securities
Oceanic Airways makes investments in available-for-sale securities. Selected income statement items for the years ended December 31, 2016 and 2017, 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. If required, use the minus sign to indicate a net or operating loss, unrealized losses, or a credit balance in the valuation allowance account.
| Oceanic Airways | ||
| Selected Income Statement Items | ||
| For the Years Ended December 31, 2016 and 2017 | ||
| 2016 | 2017 | |
| Operating Income (Loss) | $ | $ |
| Gain (Loss) from Sale of Investments | 4200 | (8400) |
| Net Income (Loss) | $ | $(11550) |
Feedback
| Oceanic Airways | |||
| Selected Balance Sheet Items | |||
| December 31, 2015, 2016, and 2017 | |||
| Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2017 | |
| Assets | |||
| Available-for-Sale Investments, at Cost | $81900 | $71400 | $99750 |
| Valuation Allowance for Available-for-Sale Investments | 5250 | (6300) | |
| Available-for-Sale Investments, at Fair Value | |||
| Stockholders' Equity | |||
| Unrealized Gain (Loss) on Available-for-Sale Investments | (7,350) | ||
| Retained Earnings | $172200 | $243600 | $ |
Solutions
Expert Solution
1.Income statement items for the Year ended December 31, 2016 and 2017
| Particulars | Year 2016 | Year 2017 |
|
Operating income (Loss) Gain (Loss) from sale of investment |
$67,200 (71400-4200) $4200 |
($3150) [8400 - 11550] ($8400) |
| Net income (loss) | $71,400 | ($11550) |
Note :
Net income for the year ending on December 31, 2016 :
= Retained earnings as on Dec 31st 2016 - Retained earnings as on Dec 31st 2015
= 243,600- 172,200
= $71,400
2.Balance sheet items for the Year ended December 31, 2015, 2016 and 2017
| Oceanic Airways | |||
| Selected Balance Sheet Items | |||
| December 31, 2015, 2016, and 2017 | |||
| Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2017 | |
| Assets | |||
| Available-for-Sale Investments, at Cost | $81,900 | $71,400 | $99,750 |
| Valuation Allowance for Available-for-Sale Investments | $5,250 | ($6,300) | ($7,350) |
| Available-for-Sale Investments, at Fair Value | $87,150 | $65,100 | $92,400 |
| Stockholders' Equity | |||
| Unrealized Gain (Loss) on Available-for-Sale Investments | $5,250 | ($6300) | ($7,350) |
| Retained Earnings | $172,200 | $243,600 | $232,050 |
Notes:
1.Retained earnings balance as on December 31, 2017 :
= Retained earnings as on Dec 31st 2016 + Net income (loss) as on Dec 31st 2017
= $243,600 - $11550
= $232,050
2. Available for Sale Investments, at Fair Value 2015 =
Available for Sale Investments, At Cost 2015 + Valuation Allowance for Available-for-Sale Investments
=$81,900 + $5,250
=$87,150
3. Unrealised Gain (Loss) on Available-for-Sale investments =Valuation allowance for Available for sale of investments = $5,250
4. In similar way Available for Sale Investments, at Fair Value 2016 and Unrealised Gain (Loss) on Available-for-Sale investments for 2016 is calculated.
5.Valuation Allowance for Available-for-Sale Investments, 2017 = Unrealized Gain (Loss) on Available-for-Sale Investments, 2016 = ($7350)
6. Available for Sale Investments, at Fair Value 2017 =
Available for Sale Investments, At Cost 2017 + Valuation Allowance for Available-for-Sale Investments
=$99750 + ($7,350)
=$92,400
ekkarill92 answered 2 years agoRelated Solutions
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