Western Die-Casting Company holds an investment in unsecured bonds of LGB Heating Equipment, Inc. When the investment was acquired, management's intention was to hold the bonds for resale. Now management has the positive intent and ability to hold the bonds to maturity. How should the reclassification of the investment be accounted for?
Answer to relevant QuestionsAre there circumstances in which the cost method is required under U.S. GAAP but not under IFRS? Explain.The fair value of depreciable assets of Penner Packaging Company exceeds their book value by $12 million. The assets' average remaining useful life is 10 years. They are being depreciated by the straight-line method. Finest ...When market rates of interest rise after a fixed-rate security is purchased, the value of the now-below-market, fixed-interest payments declines, so the market value of the investment falls. If that drop in fair value is ...Adams Industries holds 40,000 shares of FedEx common stock. On December 31, 2010, and December 31, 2011, the market value of the stock is $95 and $100 per share, respectively. What is the appropriate reporting category for ...LED Corporation owns $1,000,000 of Branch Pharmaceuticals bonds and classifies its investment as securities available-for-sale. The market price of Branch's bonds fell by $450,000, due to concerns about one of the company's ...
Post your question