Ace Company purchased 10,000 bonds issued by Jack Company in 2018 for $63 per bond and classified the investment as securities available-for-sale. The value of the Jack investment was $81 per bond on December 31, 2019, and $110 per bond on December 31, 2020. During 2021, Ace sold all of its Jack investment at $145 per bond. In its 2021 income statement, Ace would report: Multiple Choice A gain of $350,000. A gain of $470,000, A gain of $1,290,000. A gain of $820,000.
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A: Formulas that are used:-
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A:
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Q: interest inco
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Q: uming that the compan
A: As per protocol, allowed to answer first question and post the remaining in the next submission.
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- Dolphin Company purchased 10,000 Shark Company bonds in 2018 for $57 per bond and classified the investment as securities available-for-sale. The value of the Shark investment was $82 per bond on December 31, 2019, and $101 per bond on December 31, 2020. During 2021, Dolphin sold all of its Shark investment at $141 per bond. In its 2021 income statement, Dolphin would report: Multiple Choice A gain of $1,280,000. A gain of $840,000. A gain of $400,000. A gain of $440,000. Next > < Prev 4 of 16 MacBook Air 身Penta Company purchased 1,000 bonds of Gone Company in 2018 for $810 per bond and classified the investment as securities available-for-sale. The value of these holdings was $272 per bond on December 31, 2019, and $421 per bond on December 31, 2020. During 2021, Penta sold all of its Gone bonds at $390 per bond. In its 2021 income statement, Penta would report: 53 Multiple Choice A trading gain of $31,000 and an unrealized holding loss of $390,00. A loss on the sale of investments of $420,000. A realized gain of $31,00O. A recognition of unrealized holding losses of $272,00o. 7 of 16 Next >CBRE Group purchased 10,000 Dover Corporation bonds in 2018 for $59 per bond and classified the investment as securities available-for-sale. Dover bonds have a 6% coupon rate. The value of the Dover investment was $83 per bond on December 31, 2019, and $92 per bond on December 31, 2020. During 2021, CBRE sold all of its Dover investment at $150 per bond. In its 2021 income statement, CBRE would report as unrealized gains/losses: Multiple Choice A gain of $910,000. A gain of $580,000. A gain of $330,000, A gain of $1,240,000. O O OSurface Company purchased 1,000 bonds of Slick Company in 2018 for $760 per bond and classified the investment as securities available-for-sale. The value of these holdings was $260 per bond on December 31, 2019, and $444 per bond on December 31, 2020. During 2021, Surface sold all of its Slick bonds at $380 per bond. In its 2021 income statement, Surface would report: Multiple Choice A trading gain of $64,000 and an unrealized holding loss of $380,000. A loss on the sale of investments of $380,000. A recognition of unrealized holding losses of $260,000. A realized gain of $64,000.On December 31, 2020, Alberta Inc. purchased $500,000, 10% bonds issued by Banff Ltd. The bonds have a maturity date of December 31, 2026. The market interest rate on December 31, 2020 was 9.5%. If Alberta Inc. accounts for this investment under the amortized cost model, what is the amount at which the Investment in Banff Ltd. Bonds will be reported on the statement of financial position at December 31, 2021, given that the current market interest rate is 9%? $490,523 $509,599 $519,448 $511,050On January 1, 2021, Jason Corp. purchased 5-year bonds with a face value of P10,000,000 and a stated interest rate of 12% per year collectible every December 31. The bonds were acquired to yield 11%. These bonds were classified based on business model of collecting contractual cash flows and to sell. On December 31, 2021 and December 31, 2022, the bonds were quoted at 104 and 102, respectively. At what amount should the investment be reported in its December 31, 2022 statement of financial position? Group of answer choices P10,200,000 P10,400,000 P10,000,000 P10,150,000CSUN Corporation purchased 1,000 Diamond Corporation bonds in 2018 for $500 per bond and classified the investment as securities available-for-sale. The value of the Diamond investment was $600 per bond on December 31, 2019, and $650 per bond on December 31, 2020. During 2021, CSUN sold all of its Diamond investment at $700 per bond. If CSUN records unrealized holding gains and losses up to the moment of sale, what would be the amount of reclassification adjustment that CSUN would record upon sale? A credit of $150,000. A debit of $200,000. A debit of $150,000. A credit of $200,000.On January 1, 2019, Alpha Inc purchased $500,000, 9% bonds issued by Beta Corp. The bonds have a maturity date of December 31, 2024. The market interest rate on January 1, 2019 was 10%. If Alpha Inc accounts for this investment under the FVOCI model, what is the amount at which the Investment in Beta Corp. Bonds will be reported on the statement of financial position at December 31, 2021, given that the current market interest rate is 9.5%? $490,401 $481,046 $487,566 $493,728On June 1, 2020, LM company purchased debt investment at amortized cost, 8,000 of P1,000 face value bonds for P7,383,000. The bonds were purchased to yield 10%. Interest is payable semi-annually on December 1 and June 1. On June 1, 2021, LM sold the bonds for P7,850,000. This amount includes the appropriate accrued interest. How much is the gain or loss on the sale of the debt investment?On January 1, 2020, Ye Company purchased 8% bonds in the face amount of P4,000,000. The bonds mature on January 1, 2025, and were purchased for P4,335,000 to yield 6%. Interest is payable every December 31. The business model for this investment is to collect contractual cash flows composed of principal and interest and to sell the asset in the open market. Fair value on December31, 2020, was P3,870,000 at 9% effective rate. Fair value on December 31, 2021,was P3,615,000 at 12% effective rate. On December 31, 2020, the entity changed the business model for this investment to realize fair value changes. On January 1, 2021, the fair value of the bonds did not change. What total amount is included in profit or loss in 2021 as a result of the reclassification from FVOCI to FVPL? A.P450,100 gainB.P660,100 gainC.P660,100 lossD.P450,100 lossOn January 1, 2021, Illuminati Company purchased 10% bonds with a face amount of P3,000,000. The bonds mature on January 1, 2031, and were purchased for P3,405,000 to yield 8%. The entity used the effective interest method of amortization and interest is payable annually every December 31. The business model for this investment is to collect contractual cash flows composed of interest and principal. On December 31, 2022, the entity changed the business model for this investment to realize fair value changes. On January 1, 2023, the fair value of the bonds was P2,845,000 at an effective rate of 11%. How much is the gain or loss on reclassification? 502,592 gain O 502,592 loss 532,400 gain O 532,400 lossSmith Corporation’s debt investment information is as follows: 1/1 /20 Purchased $100,000, 9% bonds of Nathen Company bonds at 98 with an annual yield of 10%. The bonds pay interest annually on 12/31 and are classified as available-for-sale. 12/31/20 Received $9,000 interest for investments in Nathen Company bonds for 2020 (note: the discount of the bond investments should be amortized using the effective interest method when recording the receipt of $9,000 interest on 12/31/20). 12/31 /20 The market prices of the debt investments at 12/31/2020 was: Nathen company bonds, 99. The fair value adjustment account balance was zero prior to the fair value adjustment on 12/31/2020. Required: Prepare journal entries for the transactions occurred on 1/1/2020 and 12/31/2020. Make the appropriate entry to apply the fair market valuation for the debt investments on 12/31/2020. If the management reported the debt investments in Nathen as held-to-maturity securities what would be the…SEE MORE QUESTIONS