Question

Harper Corporation has the following portfolio of investments at December 31, 2014, that qualify and are accounted for using the fair value through other comprehensive income (FV-OIC) method:
Early in 2015, Harper sold all the Frank Inc. shares for $17 per share, less a 1% commission on the sale. On December 31, 2015, Harper's portfolio consists of the following common shares:
Assume Harper reports net income of$158,300 for its year ended December 31, 2015, and the company follows a policy of capitalizing transaction costs and of transferring realized gains and losses from accumulated other comprehensive income directly to retained earnings.
Instructions
(a) What should be reported on Harper's December 31, 2014 statement of financial position for this long-term portfolio?
(b) What should be reported on Harper's December 31, 2015 statement of financial position for these investments?
(c) What should be reported on Harper's 2015 statement of comprehensive income for the investments accounted for using the FV-OCI model? Prepare a partial 2015 statement of comprehensive income for Harper.
(d) Assuming that comparative financial statements for 2014 and 2015 are presented in 2015, draft the footnote that is necessary for full disclosure of Harper's transactions and investments.
(e) As a potential investor in Harper Corporation, explain what information the other comprehensive income portion of the statement of comprehensive income provides to you.


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  • CreatedSeptember 18, 2015
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