Hussain Corp. gave you the following information about its investment in Fahad Corp. shares purchased in May 2020 and accounted for using the FV-OCI method:

Cost $39,000

Fair value, December 31, 2020 42,750

Fair value, December 31, 2021 33,200

Fair value, December 31, 2022 37,400

Instructions

a. Prepare the adjusting journal entries needed on December 31, 2020, 2021, and 2022.

b. Determine the balance in accumulated other comprehensive income on the statement of financial position on each of December 31, 2020, 2021, and 2022.

c. Assume that Hussain sold its investment in Fahad Corp. on February 13, 2023, for $38,000. Prepare the journal entry(ies) needed, including reclassifying holding gains or losses to retained earnings on this date, assuming the investments are in shares and no recycling to net income is recorded.

d. What will be the balance in Accumulated Other Comprehensive Income on December 31, 2023? Hint - show with a Tee a/c