Question
Dixie Corporation recorded the following transactions for its long-term investments during 2018: April 30 Purchased 3,000 shares of Enigma Corporation stock at $23 per share
Dixie Corporation recorded the following transactions for its long-term investments during 2018:
April 30 | Purchased 3,000 shares of Enigma Corporation stock at $23 per share and classified the shares as FVTPL financial assets- Equity. Dixie did not make the irrevocable option to measure the equity investment as FVTOCI, and Dixie did not tend to influence or control Enigma. Enigma Corporation has 50,000 shares outstanding. |
May 31 | Received a cash dividend of $2.00 per share on Enigma Corporation stock. |
July 29 | Sold 1,000 shares of Enigma Corporation stock for $25 per share. |
December 15 | Sold 2,000 shares of Enigma Corporation stock for $20 per share. |
Determine the amount of following account on December 31, 2018.
1.Fair Value through Profit or Loss Financial Assets, Enigma Corp. =
2.Valuation Adjustment for Fair Value through Profit or Loss Financial Assets, Enigma Corp. =
3.Determine the amount of net increase/decrease in net income of the long-term investments. =
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started