Selected condensed information (in millions) for Investments R Us Company, a public company, follows for the year ended November 30, 2021.

Income from investment in associate .................................. $ 4
Gain on sale of land .................................................................. 26
Income tax expense ................................................................ 781
Interest expense ..................................................................... 299
Interest revenue .......................................................................... 6
Investment income or (loss) ................................................. (192)
Dividend revenue ........................................................................ 3
Operating expenses ............................................................. 4,616
OCI—holding gain or (loss), net of tax ................................... (68)
Other expenses .......................................................................... 21
Revenues ............................................................................... 7,240

Instructions

a. Prepare an income statement and separate statement of comprehensive income for the year ended November 30, 2021.

b. Investments R Us Company had an opening balance in its Accumulated Other Comprehensive Loss account of $150 million. What is the ending balance it would report in the shareholders’ equity section of its balance sheet at November 30, 2021?

Taking It Further

Explain why a company may want to report gains and losses on fair value adjustments for its investments in other comprehensive income instead of including them in profit.