Problem 1 Cost FV

2017 Rhaegar Corp 155,000 139,000

Viserys Limited 182,000 190,000
Total 337,000 329,000

a. 31-Dec-17 Unrealized Holding Gain or Loss—Income 8,000

Fair Value Adjustment 8,000

Rhaegar corp - cost 155,000

Selling price 155,000 (31 x 5000)
less fees 1,500
Net Proceeds 153,500
Loss 1,500

b 1-Mar-18 Cash 153,500

Loss on Sale of Investments 1,500
Equity Investment 155,000

Daenerys Stores 27,000 (600 x 45)

fees 550

c 1-Apr-18 Equity Investments 27,000

Broker Expense 550
Cash 27,550

Cost FV
Viserys Limited 182,000 195,500
Daenerys Stores 27,550 25,500
Total 209,550 221,000
Previous FV adjustment (Cr)
FV Adjustment - Dr
OR
FV Adjustment Dr Cr
Beg Balance 8,000
FV Adjustment -2018 19,450
Ending Balance 11,450

d 31-Dec-18 Fair Value Adjustment 19,450

Unrealized Holding Gain or Loss—Income 19,450
Unrealized gain/loss
(16,000)
8,000
(8,000)

Unrealized gain/loss
13,500
(2,050)
11,450
(8,000)
19,450
 Non Trading Investment (FVOCI) Hero
Date Account Debit Credit
13-Jul-16 Equity Investment- Hero 1,750,000
Cash 1,750,000

5-Dec-16 Cash 125,000

Dividend Revenue 125,000

Cost FV
Hero 1,750,000 2,300,000

31-Dec-16 Fair Value Adjustment 550,000

Unrealized Holding Gain or Loss—OCI 550,000

Cost FV
Hero 1,750,000 1,800,000
Previous adjustment (Dr)
Change in FV adjustment (loss)

OR
FV Adjustment Dr Cr
Beg Balance 550,000
FV Adjustment -2016 500,000
Ending Balance 50,000

14-Apr-17 Cash 1,800,000

Unrealized Holding Gain or Loss—OCI 500,000
Equity Investment-Hero 1,750,000
FV Adjustment 550,000

Unrealized Holding Gain or Loss—OCI Dr Cr

Beg Balance 550,000
FV Adjustment -2016 500,000
Ending Balance 50,000

After Sales of the investment

Unrealized Holding Gain or Loss—OCI 50,000
Retained Earning 50,000

OR - alternative Journal Entries

J1 Unrealized Holding Gain or Loss—OCI 500,000
FV Adjustment 500,000
J2 Cash 1,800,000
Equity Investment-Hero 1,750,000
FV Adjustment 50,000

J3 After Sales of the investment

Unrealized Holding Gain or Loss—OCI 50,000
Retained Earning 50,000

Statement of Financial Position

As of 31 Dec 2016
Investment
Equity investment 3,800,000

Equity
AOCI 325,000

Statement of Comprehensif Income

For the year ended 31 Dec 2016
Other income and expense
Dividend Revenue 225,000

OCI
Unrealized holding gain/loss 325,000
 Non Trading Investment (FVOCI) Ikea
Date Account Debit
(1750 x 1000) 10-Oct-16 Equity Investment- Ikea 1,725,000
Cash

10-Nov-16 Cash 100,000

(125 x 1000) Dividend Revenue

Unrealized gain/loss Cost

550,000 Ikea 1,725,000

31-Dec-16 Unrealized Holding Gain or Loss—OCI 225,000

Fair Value Adjustment

Unrealized gain/loss Cost

50,000 Ikea 1,725,000
(550,000) Previous adjustment (Cr)
(500,000) Change in FV adjustment

OR
FV Adjustment Dr
Beg Balance
FV Adjustment -2016 250,000
Ending Balance 25,000

5-May-17 Cash 1,750,000

FV Adjustment 225,000
Equity Investment-Hero
Unrealized Holding Gain or Loss—OCI

Unrealized Holding Gain or Loss—OCI Dr

Beg Balance 225,000
FV Adjustment -2016
Ending Balance

After Sales of the investment

Retained Earning 25,000
Unrealized Holding Gain or Loss—OCI

OR - alternative Journal Entries

FV Adjustment 250,000
Unrealized Holding Gain or Loss—OCI
Cash 1,750,000
FV Adjustment
Equity Investment-Ikea

After Sales of the investment

Retained Earning 25,000
Unrealized Holding Gain or Loss—OCI
 Credit
(850 x 25.000) + 25.000
1,725,000

100,000 (50 x 2000)

FV Unrealized gain/loss
1,500,000 (225,000)

225,000

FV Unrealized gain/loss
1,750,000 25,000
225,000
250,000

Cr
225,000

1,725,000
250,000

Cr

225,000
25,000

25,000

250,000
 25,000
1,725,000

25,000
 Equity Method
Date Account Debit Credit
1-Jan-17 Equity Investment - Magnum 2,975,000,000
Cash 2,975,000,000
9-Mar-17 Cash 52,500,000
Equity Investment-Magnum 52,500,000
30-Jun-17 Investment loss 4,000,000
Investment-Magnum 4,000,000
31-Dec-17 No entry

Equity Investment
Beg balance 2,975,000,000
Cash Dividend (52,500,000)
Net Loss (4,000,000)
Ending Bal 2,918,500,000

PT. Multilever Indonesia

Partial Statement of Financial Position
December, 31 2013

Current Asset:
Non Current Asset:
Equity Investment 2,918,500,000
 Keterangan

(350.000 x 8.500)

(350.000 lbr x Rp 150)

(10.000.000 x 40%)
 a. Correct entry Entry made
Sansa Co. Cash 28,000 Cash
Equity Investments 20,000 Equity Investments
Gain on Sale of Investments 8,000

Arya Inc. Cash 24,000 Cash

Dividend Revenue 24,000 Equity Investments

b. Quantity Cost Fair Value

Sansa Co. 4,000 200,000 296,000
Arya Inc. 20,000 800,000 640,000
1,000,000 936,000

Adjusting Entry:
31-Dec-17 Unrealized Holding Gain or Loss—Equity 64,000
Fair Value Adjustment 64,000
Entry made Correction
28,000 Equity Investments 8,000
28,000 Gain on Sale of Investments 8,000

24,000 Equity Investments 24,000

24,000 Dividend Revenue 24,000

Increase (Decrease)
96,000
(160,000)
(64,000)