Question
London Ltd. reported the following transactions and information regarding the shares of Dolma Corp: 15 October 20X2, purchased 3,600 shares at $48 per share plus
London Ltd. reported the following transactions and information regarding the shares of Dolma Corp:
15 October 20X2, purchased 3,600 shares at $48 per share plus $1,500 commission. 1 December 20X2, received $0.40 per share cash dividend. 31 December 20X2, fair value is $42 per share. 1 December 20X3, received $0.40 per share cash dividend. 31 December 20X3, fair value is $51 per share. 15 November 20X4, sold 1,200 shares at $48 per share less $920 commission. 1 December 20X4, received $0.40 per share cash dividend. 31 December 20X4, fair value is $47 per share.
Required:
1. Show the amounts and accounts that would be reported in earnings and the statement of financial position for 20X2, 20X3, and 20X4 if the company uses the: (Negative amounts should be indicated by minus sign.) a. Cost method.
b. FVTPL method.
c. FVOCI-Equity method; realized amounts are transferred to retained earnings.
\begin{tabular}{|l|rr|rr|rr|} \hline & \multicolumn{2}{|c|}{202} & \multicolumn{2}{|c|}{203} & \multicolumn{2}{|c|}{204} \\ \hline Earnings & & & & & & \\ \hline Dividend revenue & $ & 1,440 & $ & 1,440 & $ & 960 \\ \hline Fees and commissions expense & $ & 1,500 & & & $ & 920 \\ \hline Loss on sale & & & & & & 7,200 \\ \hline Statement of financial position & & & & & & \\ \hline Investment & $ & 151,200 & $ & 151,200 & & 100,800 \\ \hline OCl: Holding gain/(loss) & $(21,600) & & & & \\ \hline \end{tabular} \begin{tabular}{|l|ll|ll|ll|} \hline & \multicolumn{2}{|c|}{202} & & 203 & & \multicolumn{2}{|c|}{204} \\ \hline Earnings & & & & & \\ \hline Dividend revenue & $ & 1,440 & $ & 1,440 & $ & 960 \\ \hline Fees and commissions expense & & 1,500 & & & $ & 920 \\ \hline Holding gains (losses) & & & & & & \\ \hline Statement of financial position & & & & & \\ \hline Investment & & & & & & \\ \hline OCl: Holding gain/(loss) & & & & & \\ \hline \end{tabular} \begin{tabular}{|c|c|c|c|} \hline & 202 & 203 & 204 \\ \hline \multicolumn{4}{|l|}{ Earnings } \\ \hline \multicolumn{4}{|l|}{ Dividend revenue } \\ \hline \multicolumn{4}{|l|}{ Fees and commissions expense } \\ \hline \multicolumn{4}{|l|}{ Holding gains (losses) } \\ \hline \multicolumn{4}{|l|}{ Statement of financial position } \\ \hline \multicolumn{4}{|l|}{ Investment } \\ \hline \multicolumn{4}{|l|}{ OCl: Holding gain/(loss) } \\ \hline \multicolumn{4}{|l|}{ Transfer to Retained Earnings } \\ \hline OCl: Holding gain/(loss) after transferring to Retained Earnings & $ & $ & 0 \\ \hline \end{tabular}
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