Question 3 of 4 - / 6 View Policies Current Attempt in Progress Monty Corporation owns corporate bonds at December 31, 2020, accounted for using the amortized cost model. These bonds have a par value of $ 768,000 and an amortized cost of $ 756,000. After an impairment review was triggered, Monty determined that the discounted impaired cash flows are $ 708,000 using the current market rate of interest, but are $ 705,000 using the market rate when the bonds were first acquired. The company follows a policy of directly reducing the carrying amount of any impaired assets. For simplicity purposes, assume that no impairment loss had been recorded earlier. Assuming Monty Corporation is a private enterprise that applies ASPE, prepare the journal entry related to the impairment at December 31, 2020. (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 for the amounts.) Account Titles and Explanation Debit Credit Date Dec. 31, , 2020 e Textbook and Media Assuming Monty Corporation is a private enterprise that applies ASPE, prepare the journal entry related to a December 31, 2021 fair value of $ 730,000 and an adjusted carrying amount at that date of $ 712,000. (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 for the amounts.) ) Date Account Titles and Explanation Debit Credit Dec. 31, 2021 e Textbook and Media Assuming that Monty Corporation applies IFRS and that there has been a significant increase in credit risk, prepare the journal entry related to the impairment at December 31, 2020. (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 for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31. 2020 e Textbook and Media Assuming Monty Corporation applies IFRS and that there has been a significant increase in credit risk, prepare the journal entry related to a December 31, 2021 fair value of $ 730,000 and an adjusted carrying amount at that date of $ 712,000. Assume that the discounted cash flow numbers provided reflect the lifetime expected risk of default. (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 Ofor the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31, 2021 e Textbook and Media Assume that Monty is a private enterprise under that applies ASPE and that the company uses a valuation allowance instead of directly reducing the carrying amount of the investment. Prepare the entry required for the impairment. (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 for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31, 2020 e Textbook and Media Assume that Monty is a private enterprise that applies ASPE, and that the company uses a valuation allowance instead of directly reducing the carrying amount of the investment. Prepare the entry required for the subsequent increase in fair value related to December 31, 2021, assuming fair value of $ 730,000 and an adjusted carrying amount at that date of $ 712,000. (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 O for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31, 2021 e Textbook and Media Question 3 of 4 - / 6 View Policies Current Attempt in Progress Monty Corporation owns corporate bonds at December 31, 2020, accounted for using the amortized cost model. These bonds have a par value of $ 768,000 and an amortized cost of $ 756,000. After an impairment review was triggered, Monty determined that the discounted impaired cash flows are $ 708,000 using the current market rate of interest, but are $ 705,000 using the market rate when the bonds were first acquired. The company follows a policy of directly reducing the carrying amount of any impaired assets. For simplicity purposes, assume that no impairment loss had been recorded earlier. Assuming Monty Corporation is a private enterprise that applies ASPE, prepare the journal entry related to the impairment at December 31, 2020. (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 for the amounts.) Account Titles and Explanation Debit Credit Date Dec. 31, , 2020 e Textbook and Media Assuming Monty Corporation is a private enterprise that applies ASPE, prepare the journal entry related to a December 31, 2021 fair value of $ 730,000 and an adjusted carrying amount at that date of $ 712,000. (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 for the amounts.) ) Date Account Titles and Explanation Debit Credit Dec. 31, 2021 e Textbook and Media Assuming that Monty Corporation applies IFRS and that there has been a significant increase in credit risk, prepare the journal entry related to the impairment at December 31, 2020. (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 for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31. 2020 e Textbook and Media Assuming Monty Corporation applies IFRS and that there has been a significant increase in credit risk, prepare the journal entry related to a December 31, 2021 fair value of $ 730,000 and an adjusted carrying amount at that date of $ 712,000. Assume that the discounted cash flow numbers provided reflect the lifetime expected risk of default. (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 Ofor the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31, 2021 e Textbook and Media Assume that Monty is a private enterprise under that applies ASPE and that the company uses a valuation allowance instead of directly reducing the carrying amount of the investment. Prepare the entry required for the impairment. (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 for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31, 2020 e Textbook and Media Assume that Monty is a private enterprise that applies ASPE, and that the company uses a valuation allowance instead of directly reducing the carrying amount of the investment. Prepare the entry required for the subsequent increase in fair value related to December 31, 2021, assuming fair value of $ 730,000 and an adjusted carrying amount at that date of $ 712,000. (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 O for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31, 2021 e Textbook and Media
