The following information relates to the Brown Corporation for the year ended De
ID: 2514949 • Letter: T
Question
The following information relates to the Brown Corporation for the year ended December 31, 2017:
2017 net income $75,000
Unrealized holding gain on available-for-sale debt securities during the year $6,000
Unrealized holding loss on equity securities classified as trading securities ($4,000)
The accumulated other comprehensive income (AOCI) account had a credit balance of $45,000 at the end of 2016. Assuming no other changes during the year affected AOCI and assuming that the unrealized loss on trading securities is already reflected in 2017 income, determine the following:
OTHER COMPREHENSIVE INCOME FOR THE YEAR
COMPREHENSIVE INCOME FOR THE YEAR
ENDING BALANCE IN ACCUMULATED OTHER COMPREHENSIVE INCOME
Explanation / Answer
Computation of Other Comprehensive Income for the year Particulars Amount A Unrealised holding gain on available for sale debt securities $ 6,000 B Unrealised holding loss on equity securities $ (4,000) C Other Comprehensice Income for the Year (A+B) $ 2,000 Computation of Accumulated Other Comprehensive Income Particulars Amount D Accumulated other Comprehensive Income at beginning of 2017 $ 45,000 Add: Other Comprehensive Income for the year $ 2,000 E Accumulated other Comprehensive Income at end of 2017 (C+D) $ 47,000 Computation of Comprehensive Income for year 2017 Particulars Amount F Net Income $ 75,000 Add: Accumulated other Comprehensive Income at end of 2017 $ 47,000 Comprehensive Income for 2017 (E+F) $ 122,000
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