Fund and Other Investments

PROBLEM. The following accounts appear on the adjusted trial balance of Apple Company on December 31, 2020:

Petty cash fund 10,000

Payroll fund100,000

Interest fund20,000

Sinking fund cash500,000

Sinking fund securities1,000,000

Accrued receivable - sinking fund security50,000

Plant expansion fund 600,000

Cash surrender value150,000

Investment property3,000,000

Preference Redemption Fund2,000,000

Advances to subsidiary200,000

Dividend fund30,000

Investment in joint venture2,000,000

REQUIRED: What is the total non-current asset of Apple Company on December 31, 2020?

Investment in Debt Securities (Trading, FA at FVOCI and FA at Amortized Cost)

PROBLEM. On January 1, 2020, Smart Inc. invested in Bond Securities of Globe Inc. The face value of the bonds is P1,000,000 with a term of 3 years. The nominal interest rate of the bonds is 10% and the interest is payable annually on December 31. The yield rate of this bond is 12%. The fair values of the bonds are as follows:

December 31, 2020900,000

December 31, 20211,100,000

December 31, 2022800,000

REQUIRED: Based on the result of your audit, determine the following:

AssumptionTrading SecurityFA at FVOCIFA at AC

Initial Measurement

Interest Income in 2020

Interest Income in 2021

Book Value on 12/31/2020

Book Value on 12/31/2021

Unrealized Holding Gain (Loss) P/L 12/31/2020

Unrealized Holding Gain (Loss) P/L 12/31/2021

Unrealized Holding Gain (Loss) OCI 12/31/2020 (IS)

Unrealized Holding Gain (Loss) OCI 12/31/2021 (IS)

Unrealized Holding Gain (Loss) OCI 12/31/2021 (SFP)