Rosewater Corporation, a publicly traded company, reported a realized gain in the year ended April 30, 2015,
Question:
Rosewater Corporation, a publicly traded company, reported a realized gain in the year ended April 30, 2015, on the sale of a long-term bond investment that was held to earn interest revenue. For the same year, the company also had an unrealized loss of $28,000 on its equity trading investments and $17,000 of revenue relating to its share of the profit of an associate. The accountant was not sure if these items should have been included in profit or in other comprehensive income. Identify whether each of the above items should be included in profit or OCI. Would your answer change if Rosewater made an election under IFRS to use fair value through OCI for the trading investments?
Step by Step Answer:
Financial Accounting Tools for Business Decision Making
ISBN: 978-1118644942
6th Canadian edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso, Barbara Trenholm, Wayne Irvine