Chapter 1 Problem 9-21 to 27
Problem 9-21
Question 1 – Answer B
Market value – December 31, 2008 1,550,000
Market value – December 31, 2007 1,000,000
Unrealized gain – trading 550,000
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Question 2 – Answer A
Market value – December 31, 2008 1,300,000
Market value – December 31, 2007 1,200,000
Unrealized gain in 2008 100,000
Unrealized loss – December 31, 2007 (1,500,000 – 1,200,000) ( 300,000)
Net unrealized loss – December 31, 2008 ( 200,000)
Problem 9-22 Answer A
The unrealized loss of P40,000 on trading securities is shown in the income statement.
However, the unrealized loss of P100,000 on available for sale securities is recognized in
equity.
Problem 9-23 Answer B
Unrealized losses 260,000
Unrealized gains 40,000
Net unrealized loss – December 31, 2008 220,000
Problem 9-24 Answer B
Net sales price 1,450,000
Unrealized loss related to B ( 150,000)
Net amount 1,300,000
Carrying amount of B (1,550,000)
Loss on sale ( 250,000)
Net sales price (1,500,000 – 50,000) 1,450,000
Less: Cost of B 1,700,000
Loss on sale ( 250,000)
Problem 9-25 Answer C
Market value – December 31, 2008 850,000
Market value – December 31, 2007 800,000
Unrealized gain in 2008 50,000
Unrealized loss – December 31, 2007 (200,000)
Net unrealized loss – December 31, 2008 (150,000)
Problem 9-26 Answer C
Available for sale equity securities, at cost 2,200,000
Unrealized loss ( 200,000)
Market value 2,000,000
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Problem 9-27 Answer C
12/31/2007 Unrealized loss - AFS 200,000
Available for sale securities 200,000 (2,000,000 – 1,800,000)
12/31/2008 Available for sale securities 50,000
Unrealized loss – AFS (1,850,000 – 1,800,000) 50,000
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