accounting of Investments 6. AS OF JANUARY 15T, 2018, DLB LAKERS, INC. HAD CASH

Question

accounting of Investments

6. AS OF JANUARY 15T, 2018, DLB LAKERS, INC. HAD CASH OF $40,000 AND AN INVESTMENTS IN BONDS WITH A FAIR VALUE OF $32,000. THE DLB LAKERS, INC. HAD NO OTHER ASSETS AND NO LIABILITIES. DLB LAKERS, INC. STOCKHOLDERS' EQUITY CONSISTED OF COMMON STOCK OF $50,000, RETAINED EARNINGS OF $20,000, AND ACCUMULATED OTHER COMPREHENSIVE INCOME OF $2,000. THE INVESTMENT IN BONDS WAS CLASSIFIED AS AN AVIALABLE FOR SALE SECURITY. IN THE YEAR 2018, DLB LAKERS, INC. RECEIVED INTERST OF $1,500 FROM THE BONDS. IN ADDITION, IT HAD AN UNREALIZED HOLDING GAIN OF S3,000 NET OF TAX IN REGARD TO THE BONDS. DETERMINE THE FOLLOWING AMOUNTS FOR 2018: NET INCOME - COMPREHENSIVE INCOME OTHER COMPREHENSIVE INCOME ACCUMULATED OTHER COMPREHENSIVE INCOME (AS OF END OF 2018)

Explanation / Answer

Net Income =    $1,500

Comprehensive Income                =   1500+3000 = $4,500

Other comprehensive Income       =   3000

Accumulated Other Comprehensive Income (As of end of 2018)   = $5,000

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