Professional Documents
Culture Documents
Problem 1
Shares
3-Jan
8
5-Apr
8
15-Jul
8-Dec
Bal.
A Corporation
Per Share
Amount
1,000
64.00
(1,000)
64.00
B Corporation
Per Share
Shares
Amount
64,000.00
1,000
50.00
50,000.00
1,000
50.00
50,000.00
(64,000.00)
5,000.00
Per audit
-
1,000
55
55,000.00
Entry Made
3-Jan Correct
8-Jan Correct
2-Apr Cash Dividend
1,000
1,000
28,000
28,000
8-Apr Correct
Correct
15-Jul Correct
its either recorded or not, but the best assumption is NO RECORDED GAIN ON SALE)
C Corporation
D Corporation
E Corporation
15-Aug Cash
33,000
33,000
20,000
20,000
Note: The question (what is the correcting entry) must have not been changed.
8-Dec Financial Assets at FV through P&L
Dividend Income
Note: Correction - 4,000 should be in Debit Column
Note: No effect in Arriving at Correct Answers
10-Dec Cash
4,000
2,200
Answers:
1) 145,900
2) (36,000)
3) (1,000+2,200+5,000)
4) (100)
4,000
8,200.00
2,200
5)
Cash
20,000
Treasury Shares
Paid in Capital From TS
16,500
3,500
Creamy Corporation
Shares
Per Share
Amount
2-Jan-08
3,000
35.00
105,000.00
11-Oct-09
9,000
60.00
540,000.00
Total
12,000
645,000.00
Fair value Adjusment to OCI
135,000.00
1-Jan-10
5-Mar
Bal
1-Jul
Bal
29-Dec
Bal.
Adj to OCI
FVOCI@FV
12,000
3,000
15,000
(5,000)
10,000
(1,000)
9,000
65.00
69.00
9,000.00
95.00
Coffee Corp
Shares
10-Aug-15
1,000
Total
1,000
Adj to OCI
FVOCI@FV
780,000.00
207,000.00
987,000.00
(281,250.00)
705,750
(71,250)
634,500
Unrealized gain
beg
realized 2010
realized 2010
220,500.00
855,000.00
Entry Made
2-Jan Cash
12,000.00
Dividend Income
1-Apr Cash
1,000
12,000
210,000.00
210,000
15,000.00
56,250
11,250
Dividend Income
1-Jul Cash
15,000
360,000.00
360,000
1,000.00
1,000
10,000.00
Dividend Income
29-Dec Miscellaneous Receivable
90,000.00
Financial Assets at FV through OCI
note: Correcteion should be reflected in credit balance of Creamy Company
Note: No effect in Arriving at Correct Answers
10,000
90,000
Answers
1)
2)
3)
4)
5)
858,500.00
97,500.00
25,000.00
221,000.00
67,500.00
Problem 3
10%Effective
Interest
Discount
Amortization
Amortized Cost,
End
Jan. 1, 2008
P3,760,000
30-Jun-08
P180,000
Dec. 31, 2008 P180,000
188,000.00
188,400.00
30-Jun-09
P180,000
Dec. 31, 2009 P180,000
30-Jun-10
P180,000
Dec. 31, 2010 P180,000
P180,000
New schedule
Nov 30, 2010
Dec 31 2010
16500
8,400.00
3,768,000.00
3,776,400.00
188,820.00
189,261.00
8,820.00
9,261.00
3,785,220.00
3,794,481.00
189,724.00
190,210.00
9,724.00
10,210.00
3,804,205.00
3,814,415.00
190,210.00
10,210.00
17,435.92
P8,000
935.92
2,096,992.75
2,097,928.67 Continue to measure at Amortized Cost, No change
Answers
1)
2)
3)
4)
376,400.00
3,776,400.00
48,278.75
Selling Price
Carrying Value
(1.8million x98%)
June 30 2010
(3,804,205*1.8/4)
Amortization
June 30 to Nov 30
(10,210*5/6)*(1.8/4)
Gain on sale on Nov 30
1,764,000.00
1,711,892.25
3,829.00
1,715,721
48,279
5)
2,097,928.67
Remaining Bond Investment:
Carrying Value
June 30 2010
(3,804,205*2.2/4)
Amortization
June 30 to Nov 30
(10,210*5/6)*(2.2/4)
6) January to June
July 1 to November 30
(190,210*5/6)
Nov 30 to December
Total interest revenue 2010
189,724.00
158,508.33
17,435.92
365,668.25
2,092,312.75
4,680.00
2,096,993
C Corporation
Per Share
Amount
Shares
1,000
20.00
1,000
20.00
D Corporation
Per Share
Shares
20,000.00
20,000.00
1,000
1,000
36.00
36.00
16,000.00
1,000
36
36,000.00
Amount
Shares
36,000.00
36,000.00
500
50
550
80.00
550
38
72.73
(2,000.00)
1,000
34
34,000.00
Should be
----------------Cash Dividend
1,000
Dividend Income
Cash
Loss on Sale
E Corporation
Per Share
1,000
28,000
36,000
Loss on Sale
64,000
Treasury Shares
Treasury Shares
33,000
Cash
33,000
(200x165)
Cash
20,000
Treasury Shares
Paid in Capital From TS
16,500
3,500
Dividend Income
No entry required
Cash
2,200
Cash Dividend Income
Dividend Receivable
Dividend Income
(1,000x5)
2,200
Dividend Receivable
5,000
5,000
Coffee Corporation
Per Share
Amount
3.00
3,000.00
3,000.00
500.00
3,500.00
3.50
Unrealized gain
135,000.00
Should be
Cash
12,000
Retained Earnings
(Credit to RE since no record on date of declaration)
Dividend Income
12,000
207,000
3,000
Dividend Receivable
210,000
12,000
Dividend Income
Dividend Income
Cash
12,000
360,000
281,250
78,750
56,250
105,000
120,000
225,000
33,750
101,250
22,500
22,500
56,250
3,000
10,000
Dividend Income
Miscellaneous Receivable
Financial Assets at FV through OCI
Gain on sale
Correct
10,000
90,000
11,250
Retained Earnings
11,250
Cost of FA@FVOCI
(1000x60)
Part of Fair Value adjustment sold
Unrealized gain
Realized gain
Balance
(1000*1/7)
60,000
135,000.00
56,250.00
78,750.00
11,250.00
11,250
Creamy
Coffee
FVOCI @ FV
Carrying amount
Unrealized gain 2010
Cash
1,899,000.00
Investment at amortized cost
interest receivable
Gain on sale
1,715,721.25
135,000.00
48,278.75
Corporation
Amount
40,000.00
40,000.00
(19,100.00)
-100.00
20,900.00
145,900.00
1,000
1,000
36,000
36,000
asury Shares
Financial Assets at FV through P&L
33,000
20,000
idend Income
Financial Assets at FV through P&L
2,000
2,200
idend Receivable
Dividend Income
5,000
33,000
16,500
3,500
2,000
2,200
5,000
100
100
idend Income
Retained Earnings
12,000
12,000
idend Receivable
Financial Assets at FV through OCI
3,000
idend Income
3,000
3,000
Cash
3,000
78,750
56,250
78,750
56,250
2,000
2,000
18,750
221,000
18,750
221,000
Shares
ying amount
ealized gain 2010
9,000 *95
1,000 *3.5
855,000
3,500.0
858,500.0
637,500.00
221,000.00