*Problem 9-5 Novak Ltd. had the following investment portfolio at January 1, 2020: Fair Value Cost per at Dec. 31, Investment Quantity Share 2019 Earl Corp. 940 $14.70 $11.90 Josie Corp. 850 19.70 16.90 Asher Corp. 500 9.40 6.90 During 2020, the following transactions took place: 1. On March 1, Josie Corp. paid a $2 per share dividend. 2. On April 30, Novak sold 300 shares of Asher Corp. for $9.70 per share. 3. On May 15, Novak purchased 200 more Earl Corp. shares at $15.70 per share. 4. At December 31, 2020, the shares had the following market prices per share: Earl Corp. $16.70; Josie Corp. $18.70; and Asher Corp. $7.70. During 2021, the following transactions took place: 5. On February 1, Novak sold the remaining Asher Corp. shares for $6.70 per share. 6. On March 1, Josie Corp. paid a $2 per share dividend. 7. On December 21, Earl Corp. declared a cash dividend of $3 per share to be paid in the next month. 8. At December 31, 2021, the shares had the following market prices per share: Earl Corp. $18.70 and Josie Corp. $20.70. Your answer is partially correct. Try again. Assuming that Novak Ltd. is a publicly accountable enterprise that accounts for its investment portfolio at FV-OCI (with no recycling to net income), prepare journal entries to record all of the 2020 and 2021 transactions and year-end events. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation 2020 Mar. 1 Cash Debit Credit Dividend Revenue Apr. 30 FV-OCI Investments Unrealized Gain or Loss - OCI (To adjust to fair value at date of disposal) Apr. 30 Cash FV-OCI Investments (To record disposal) TApr. 30 Gain or Loss in Value of In Gain or Loss in Value of In (To reclassify holding gain) May 15 FV-OCI Investments Tashl 1700 11700 1700 1840 840 2910 T2910 90 3140 T3140 2021 Feb. 1 Unrealized Gain or Loss - OCI FV-OCI Investments (To adjust to fair value at date of disposal) Feb. 1 Cash TFV-OCI Investments (To record disposal) Feb. 1 FV-OCI Investments 1200 [1340 1340 540 540 FV-OCI Investments (To reclassify holding loss) Mar. 1 Cash 1700 Dividend Revenue 170 1700 Dec. 21 Dividends Receivable Dividend Revenue Dec. 31FV-OCI Investments 3420 13420 3980 Unrealized Gain or Loss - OCI 3980 Prepare the relevant parts of Novak Ltd.'s 2021 and 2020 comparative statements of financial position, statements of comprehensive income, and statements of changes in equity (accumulated other comprehensive income portion), and income statement where applicable, to show how the investments and related accounts are reported. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Novak Ltd. Statement of Financial Position 2020 Long-Term Investments Investments, at Fair Value with Gains and Losses in OCI Shareholders' Equity Accumulated other Comprehensive Income TRetained Earnings 69 +9 2021 $ $ Ex Gross Profit (Loss) Operating Expenses Novak Ltd. Statement of Comprehensive Income Items that may not be reclassified subsequently to net income 2020 $X 2021 Holding Gains on FV-OCI Investments during year [6402 3980 $X + $X + Comprehensive Income 6402 3980 $X Novak Ltd. Statement of Changes in Accumulated Other Comprehensive Income Accumulated other Comprehensive Income/ (Loss), January 1 Other Comprehensive Income / (Loss) 2020 $ 2021 Reclassification adjustmen Accumulated other Comprehensive Income/ (Loss), December 31 Your answer is partially correct. Try again. Assume that Novak Ltd. is a private enterprise that applies ASPE and accounts for its investment portfolio at cost (that is, the securities do not have actively traded market prices). Determine the amount by which the company's 2020 net income and 2021 net income would differ from the amounts reported under the assumptions given above. Net Income 2020 The net income would not change. 2021 Question Attempts: 6 of 15 used