The following information relates to the Brown Corporation for the year ended De
ID: 2515516 • 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
Soluation:
Following Journal enteries will be passed for the year ended December 31, 2017
1. For booking Unrealized holding gain on available-for-sale debt securities
Debt Securities Dr. $6,000
AOCI A/c $6,000
2. For booking Unrealized holding loss on trading equity securities
AOCI A/c Dr. $4,000
Equity Securities $4,000
Balance in AOCI A/c as on December 31, 2017
Opening Balance + Gains - Losses
$45,000+$6,000-$4,000
=$47,000 credit balance
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