37. On November 1, 2021, Romblon Company invested in P600,000 in equity securities representing 20,000 ordinary shares of Coke Company. The investment was designated as equity investments at fair value through profit or loss since the company intends to sell the security for a short- term profit. On December 31, 2021, this investment had a market value of P580,000. On January 15, 2022, Romblon sold the investment for P630,000. What amount of realized gain should Romblon recognized on the disposal of the investments?

37. On November 1, 2021, Romblon Company invested in P600,000 in equity securities representing 20,000 ordinary shares of Coke Company. The investment was designated as equity investments at fair value through profit or loss since the company intends to sell the security for a short- term profit. On December 31, 2021, this investment had a market value of P580,000. On January 15, 2022, Romblon sold the investment for P630,000. What amount of realized gain should Romblon recognized on the disposal of the investments?

Financial Accounting

14th Edition

ISBN:9781305088436

Author:Carl Warren, Jim Reeve, Jonathan Duchac

Publisher:Carl Warren, Jim Reeve, Jonathan Duchac

Chapter15: Investments And Fair Value Accounting

Section: Chapter Questions

Problem 28E

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During 2021, Anthony Company purchased debt securities as a long-term investment and classified them as trading. All securities were purchased at par value. Pertinent data are as follows: The net holding gain or loss included in Anthonys income statement for the year should be: a. 0 b. 3,000 gain c. 9,000 loss d. 12,000 loss
On November 1, 2021, Romblon Company invested in P600,000 in equity securities representing 20,000 ordinary shares of Coke Company. The investment was designated as equity investments at fair value through profit or loss since the company intends to sell the security for a short-term profit. On December 31, 2021, this investment had a market value of P580,000. On January 15, 2022, Romblon sold the investment for P630,000. What amount of realized gain should Romblon recognized on the disposal of the investments?
24. On November 1, 2019, TUNA Company invested P600,000 in equity securities representing 20,000 ordinary shares of SARDINES Company. The investment was classified as equity security to profit or loss since the company intends to sell the security for a short-term profit. In December 31, 2019, this investment has a market value of P580,000. On January 15, 2020, TUNA Company sold the investment of P630,000. What amount of realized gain should TUNA Company recognize on the disposal of the trading security?
At the beginning of 2021, Gala company purchased equity securities to held for trading for P5,000,000. The entity also paid commission, taxes and other transaction costs amounting to P200,000. The securities had a market value of P5,500,000 at year-end. No securities were sold during the year. In the year 2022, 60% of the investments were sold. Proceeds from the sale amounted to P3,450,000 which is net of transaction costs amounting to P125,000. On December 31, 2022, the fair value of the investment is 40% more than the carrying amount at the end of 2021. What total gain/loss on trading securities should be reported in the income statement for 2022?
At the beginning of 2021, Gala company purchased equity securities to held for trading for P5,000,000. The entity also paid commission, taxes and other transaction costs amounting to P200,000. The securities had a market value of P5,500,000 at year-end. No securities were sold during the year. In the year 2022, 60% of the investments were sold. Proceeds from the sale amounted to P3,450,000 which is net of transaction costs amounting to P125,000. On December 31, 2022, the fair value of the investment is 40% more than the carrying amount at the end of 2021. What total gain/loss on trading securities should be reported in the income statement for 2022? Answer should be presented as: LOSS 123456 or GAIN 123456
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