Create an Account

Already have account?

Forgot Your Password ?

Home / Questions / In January 2011 the management’ of lzmir Company concludes that it has sufficient cash to ...

In January 2011 the management’ of lzmir Company concludes that it has sufficient cash to purchase some short-term investments in debt and share securities During the year the following transaction

In January 2011, the management’ of lzmir Company concludes that it has sufficient cash to purchase some short-term investments in debt and share securities. During the year, the following transactions occurred. Feb. 1 Purchased 500 shares of DET ordinary shares for TL30,000, plus brokerage fees of TL800. Mar. 1 Purchased 600 shares of STL ordinary shares for TL20,000, plus brokerage fees of TL300.Apr. 1 Purchased 40 TL1,000, 9% CIN bonds for TL40,000, plus TL1,200 brokerage fees. Interest is payable semiannually on April 1 and October 1. July 1 Received a cash dividend of TL0.60 per share on the DET ordinary shares. Aug. 1 Sold 300 shares of DET at TL69 per share, less brokerage fees of TL350. Sept. 1 Received a TL1 per share cash dividend on the STL ordinary shares. Oct. 1 Received the semiannual interest on the CIN bonds. Oct. 1 Sold the CIN bonds for TL45,000, less TL1,000 brokerage fees. At December 31, the fair value of the DET ordinary shares was TL66 per share. The fair value of the STL ordinary shares was TL29 per share. Instructions (a) Journalize the transactions and post to the accounts Debt Investments and Share Investments. (Use the T-account form.) (b) Prepare the adjusting entry at December 31, 20111 to report the investments at fair value. All securities are considered to be fair value through profit or loss securities. (c) Show the statement of financial position presentation of investment securities at December 31, 2011. (d) Identify the income statement accounts and give the statement classification of each account.View Solution:

Jun 16 2020 View more View Less

Answer (Solved)

question Subscribe To Get Solution

Related Questions