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Sunland Technologies inc. held a portfolio of shares and bonds that it accounted for using the fair value through other comprehensive income model at December
Sunland Technologies inc. held a portfolio of shares and bonds that it accounted for using the fair value through other comprehensive income model at December 31, 2023. This was the first year that Sunland had purchased irvestments. In part due to Sunland's inexperience, by December 31,2023 , the market value of the portfolio had dropped $29,700 below its original cost. Suntand recorded the necessary adjustments at December 31, 2023, and was determined to hold the securities until the unrealized loss from 2023 could be recovered. By December 31,2024. Sunland's goal of recovery had been realized and the original portfolio of shares and bonds had a fair market value $6,600 higher than the original purchase costs. Sunland's income tax rate is 30% for all years. Assume that any gains that will ultimately be realized on the sale of the shares and bonds are taxable as ordinary income when they are realized. Sunland applies IFRS. (a) Prepare the journal entries at December 31, 2023, to accrue the unrealized loss on Sunland's securities and the related income tax. (List all debit entries before credit entries. Credit account titles are outomatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the occount titles and enter O for the amounts)
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