Unrealized gains on AFS securities Reclassification of unreslized gsins Anderson did not make any new investments in AFS securities in Required Calculate the original cost of the AFS securities held on December 31.2017 Calculate the cash Anderson received on the sale of AFS securitie a. b. E1.1 14 Impairment of AFS and HTM Investments, U.S. GAAP and IFRS Assume The Coea-Cola Lo 1, Company reports the following investments at December 31, 2016. prior to any required end-of-year valuation adjustments 600,000 Coca-Cola classifies its investment in equity securities as AFS, and its investment in debt securities as HTM. The December 31, 2016, fair value of the cquity securities is $1,000,000, and the fair value of the debt securities is S400,000. The equity securities were originally purchased for $1600.000. Required a. Record any required journal entries to reflect fair values at year-end, assuming the investments are b. If Coca-Cola follows IFRS, are there any differences in how the value changes are recorded? Are c. It is now December 31, 2017. Coca-Cola still holds both investments. The fair value of the equity ) not impaired, and (2) impaired, following U.S. GAAP there differences in the decision to treat an investment as impaired? Explain. securities is $1,400,000 and the fair value of the debt securities is $640,000. On an amortized cost t securities balance would be $590,000 if no impairment loss had been recorded. Re- ny required journal entries at year-end, following (1) U.S. GAAP, and (2) IFRS, assuming the securities were impaired in 2016. Assume The Coca-Cola Comp any acquir Consequences of Investment Reporting Choices all of the stock of Bubbly Bottler on January 1,2016, at a cost of $950 million in cash. Bubbly's bala heet on that date is as follows (in millions): Unrealized gains on AFS securities Reclassification of unreslized gsins Anderson did not make any new investments in AFS securities in Required Calculate the original cost of the AFS securities held on December 31.2017 Calculate the cash Anderson received on the sale of AFS securitie a. b. E1.1 14 Impairment of AFS and HTM Investments, U.S. GAAP and IFRS Assume The Coea-Cola Lo 1, Company reports the following investments at December 31, 2016. prior to any required end-of-year valuation adjustments 600,000 Coca-Cola classifies its investment in equity securities as AFS, and its investment in debt securities as HTM. The December 31, 2016, fair value of the cquity securities is $1,000,000, and the fair value of the debt securities is S400,000. The equity securities were originally purchased for $1600.000. Required a. Record any required journal entries to reflect fair values at year-end, assuming the investments are b. If Coca-Cola follows IFRS, are there any differences in how the value changes are recorded? Are c. It is now December 31, 2017. Coca-Cola still holds both investments. The fair value of the equity ) not impaired, and (2) impaired, following U.S. GAAP there differences in the decision to treat an investment as impaired? Explain. securities is $1,400,000 and the fair value of the debt securities is $640,000. On an amortized cost t securities balance would be $590,000 if no impairment loss had been recorded. Re- ny required journal entries at year-end, following (1) U.S. GAAP, and (2) IFRS, assuming the securities were impaired in 2016. Assume The Coca-Cola Comp any acquir Consequences of Investment Reporting Choices all of the stock of Bubbly Bottler on January 1,2016, at a cost of $950 million in cash. Bubbly's bala heet on that date is as follows (in millions)
