2. On April 15, 2021, Pepper purchased 15,000 shares of Atty Group for P150,000. The commission paid to the broker amounted to P8,500. Management made an irrevocable choice to subsequently measure the shares at FVOCI. At what amount should the investment be recorded initially?
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- Assume the following independent cases:A. At the beginning of the year, a check was issued for P400,000 as payment for a piece of land, and the buyer assumed the liability for the unpaid taxes at the end of the year, P10,000 and those assessed for the current year at P9,000.B. A company issued 14,000 ordinary shares (P10 par) with a market value of P60 per share (based upon a recent sale of 100 shares) for the land. The land was recently appraised at P800,000 by independent and competent appraisers.C. A company rejected an offer to purchase the land for P8,000,000 cash two years ago. Instead, the company issued 100,000 ordinary shares for the land (market value of the ordinary share, P78 each based on several recent large transactions and normal weekly stock trading volume).D. A company purchased land by signing a note with the seller, requiring P100,000 down payment, payment of P120,000 one year from purchase, and P80,000 three years from purchase. The note is non-interest bearing,…Agustin Company has the following transactions relating to its investments during 2022. January 5 - Acquired 10,000 shares of Abalos Company for P1,000,000 paying additional P20,000 for brokerage fee and another P5,000 for commission. Received dividends from Abalos declared January 2, 2022 to stockholders of record January 10, 2022, P20,000. How much should the investment account be debited if the shares are held for trading?On December 12, 2021, an investment in equity securities costing $80,000 was sold for $100,000. The total of the sale proceeds was credited to the investment in equity securities account.Required:1. Prepare the journal entry to correct the error, assuming it is discovered before the books are adjusted or closed in 2021. (Ignore income taxes.)2. Prepare the journal entry to correct the error assuming it is not discovered until early 2022. (Ignore income taxes.)
- Page Ltd. is an investment management firm that had, at the beginning of the current year on January 1, 2021, a balance of $128,000 in its Trading Investments account (using the fair value through profit or loss model) and a balance of $485,000 in its Investment in Associates account (using the equity method). At the end of the year, these account balances were $147,000 and $577,000, respectively. During the year, dividends of $64,000 were received from associates while $9,000 was received from trading investments. In addition, the company purchased investments in associates and trading investments for cash of $115,000 and $55,000, respectively. Also, during 2021, the company received $43,000 when it sold trading investments that it carried at $27,000. (a) List the accounts that Page will show on its 2021 statement of income pertaining to its investments. Indicate vhere these accounts will appear on the statement of income. (Enter loss using either a negative sign preceding the number…On March 1, 2018, Rawlins Company invests $25,000 in Ashton Company stock. Ashton pays Rawlins a $800 dividend on September 30, 2018. Rawlins sells the Ashton stock on November 30, 2018 for $23,500. Assume the investment is categorized as a short-term equity investment and that Rawlins does not have significant influence over Ashton. Requirements: 1. Journalize the transactions for Rawlins' investment in Ashton's stock.2. Edwards Company began business in February of 2021. During the year, Edwards purchased the three trading securities listed below. On its December 31, 2021, balance sheet, Edwards appropriately reported a P4,000 credit balance in its Market Adjustment-Trading securities account. There was no change during 2022 in the composition of Edward's portfolio of trading securities. Pertinent data are as follows: Security A B с Cost P120,000 90,000 160,000 P370,000 Fair Value 12/31/22 P126,000 80,000 157,000 P363,000 What amount of loss on these securities should be included in Edward's income statement for the year ended December 31, 2022? d. P0| a. P11,000 b. P7,000 c. P3,000
- During the year 2021 Azimuth Corporation engaged in the following transaction with marketable securities:May 14: Azimuth purchases as a short-term investment 1,000 shares of ADIDAS. Azimuth paid €197.15 per share, plus a brokerage commission of €240. August 27: Azimuth sells 100 shares of its ADIDAS stock for €197.81 per share, less a €102 brokerage commission.October 10: Azimuth receives a €3.40 per share dividend on its ADIDAS shares.December 31: ADIDAS stock has a current market value of €198.12 per share. 3.1 Record the above four transactions in general journal.3.2. Define marketable securities. What characteristics of these securities justify classifying them as financial assets?A company invests in stock of other companies for trading purposes. Its accounting year ends December 31. Its investment activity during 2019, 2020, and 2021 is as follows: a. Purchased stock of Acme Company in 2019 for $250,000 for the purpose of taking advantage of short-term volatility in the market place. ). Sold the investment shortly after purchase for $235,000. :. Purchased stock of Beeber Company in 2019 for $300,000. 1. The investment had a fair value of $275,000 at the end of 2019. e. It was sold for $310,000 in late 2020. f. Purchased stock of Cromwell Company in 2019 for $500,000. J. Its fair value and the end of 2019 was $520,000. 1. Its fair value and the end of 2020 $460,000. i. The investment was sold for $480,000 in 2021. Prepare the entries necessary to report the above entries in either a T-account or spreadsheet format.Assume the following independent cases: (a) At the beginning of the year, a check was issued for P400,000 as payment for a piece of land and the buyer assumed the liability for unpaid taxes in arrears for the previous year, P10,000 and those assessed for the current year, P9,000.(b) A company issued 14,000 ordinary shares (P50 par) with a market value of P60 per share (based upon a recent sale of 100 shares) for the land. The land was recently appraised at P800,000 by independent and professional appraisers.(c) A company rejected an offer to purchase the land for P8,000,000 cash two years ago. Instead, the company issued 100,000 ordinary shares for the land (market value of the ordinary share, P78 each based on several recent large transactions and normal weekly stock trading volume).How much is the cost of land acquired in (a), (b), and (c), respectively? a. 419,000; 800,000; 7,800,000 b. 410,000; 800,000; 7,800,000 c. 410,000; 840,000; 7,800,000 d. 419,000; 840,000;…
- Pina Ltd. holds equities securities in its portfolio and is accounting for those investments using the FV-NI method. On March 1, 2023, the company purchased 11000 shares of a publicly traded company for $4830000 and paid a commission (brokerage fee) of $4830 on the purchase transaction. What is the cost base of the investment to include for the recording of the portfolio value? O $4834830 O $4830000 O $4825170 O None of the choices are correct.The related data of Estonia Company: On March 2, 2021, Aruba Inc. declared a cash dividend of P750,000, on which Estonia Company had an 18% ownership. The date of record is March 31, 2021, and the date of payment is April 30, 2021. On May 30, 2021, Estonia Company received a property dividend with a carrying amount of P70,000. The fair value of the property on that date is P80,000 and the fair value on June 30, 2021, which is the date of payment is P89,500. On July 15, 2021, Australia Company declared a liquidating dividend of P500,000, of which Estonia had a 15% interest. How much is the dividend income reported in the Income Statement in 2021?On December 12, 2024, an Investment in equity securities costing $84,000 was sold for $108,000. The total of the sale proceeds was credited to the Investment in equity securities account Required: 1. Prepare the Journal entry to correct the error, assuming it is discovered before the books are adjusted or closed in 2024. (Ignore Income taxes.) 2. Prepare the journal entry to correct the error assuming It is not discovered until early 2025. (Ignore income taxes.)