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intermediate accounting questions

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Question;1. (1 point)On January 1, 2014, Monopoly Corporation purchased a debt security as a held-to-maturity investment. Monopoly paid $358,859 for the 3-year bonds which had a face value of $350,000, a stated rate of 10% and pay interest annually. The bonds were sold to yield 9%, and the investment had a fair value of $354,718 at December 31, 2014.With respect to this portfolio, what dollar amount will be reported on Monopoly?s December 31, 2014, balance sheet?Investment in Bonds $___________________2. (1 point)Twister Corp owns a stock portfolio with the following 12/31/13 values:Cost Fair ValueDecember 31, 2013: $388,000 $371,000During 2014, Twister sold stocks from its portfolio. Those stocks had a cost basis of $168,000 and were sold for $172,000. Additionally, stocks were purchased for $200,000 as a passive investment. Dividends received during the year totaled $18,000. The investment portfolio had a fair value of $409,000 at December 31, 2014. ?Preliminary income? (i.e., income before consideration of these investments) for the year ended December 31, 2014, totaled $100,000.Part A) Assume the portfolio consists of only trading securities. With respect to this portfolio:What dollar amount will be reported on Twister?s December 31, 2014, balance sheet?Investment in Stocks $___________________ What dollar amount would Twister report as net income for the year ended December 31, 2014?Net Income $___________________Part B) Instead, assume that the portfolio consist of only available for sale securities, and that Twister reported the following Stockholders? Equity on its December 31, 2013, balance sheet:Common Stock $3,925,000Paid-in-Capital 9,855,000Accumulated Other Comprehensive Income 390,750Retained Earnings 7,061,340With respect to this available for sale portfolio, what dollar amounts will be reported on Twister?s December 31, 2014, balance sheet?Investment in Stocks $___________________Accumulated Other Comprehensive Income $

 

Paper#43388 | Written in 07-Mar-2016

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