creditor relationship with another entity. US GOvernment, Municipal Securities, Corporate Bonds, Convertible Debt, and Commercial Paper.
Debt securities bought and held primarily for sale in the near term to generate income on short-term price differences. WIll be sold regardless of the price.
What are the requirements to be labeled Held-to-Maturity?
Positive intent and the ability to hold securities maturity
Ownership is a business via common, preferred, or other capital stock. Include rights to dispose or acquire ownership.
What is the fair value method for equity holdings of less than 20%?
Available-for-sale securities and trading securities.
Journal entry for available-for-sale securities that has a realized holding gain or loss?
Unrealized Holding Gain or Loss-Equity
Fair Value adjustment(ava-for-sale)
Journal entry to record the sale available-for-sale securities?
Gain on Sale Investments
Equity method aka significant influence journal entry for reported net income?
Take the percentage of the ownership*net income:
Revenue from Investments
Equity method aka significant influence journal entry for cash dividends?
To reduce the overall net income. Therefore, take the % of ownership by the cash dividend and subtract from overall.
Equity method aka significant influence journal entry for net loss?
Take percentage of loss.
Loss on Investment
Equity method aka significant influence journal entry for increase and decrease of sales compared to the market and fair value?
No entry is recorded. If market price is $11 and common stock price is $10. Don't record the gain.