TAILIEUCHUNG - Lecture Accounting (6th edition): Chapter App H - Kimmel, Weygandt, Kieso

Chapter App H - Reporting and analyzing investments. In this chapter students will be able to: Explain how to account for debt investments, explain how to account for stock investments, discuss how debt and stock investments are reported in the financial statements. | Reporting and Analyzing Investments H Kimmel ● Weygandt ● Kieso Accounting, Sixth Edition CHAPTER OUTLINE Explain how to account for debt investments. 1 Explain how to account for stock investments. 2 LEARNING OBJECTIVES Discuss how debt and stock investments are reported in the financial statements. 3 Corporations purchase investments in debt or stock securities generally for one of three reasons. Corporation may have excess cash. Generate earnings from investment income. For strategic reasons. ILLUSTRATION H-1 Temporary investments and the operating cycle LO 1 LEARNING OBJECTIVE Explain how to account for debt investments. 1 Pension funds and banks regularly invest in debt and stock securities to: house excess cash until needed. generate earnings. meet strategic goals. avoid a takeover by disgruntled investors. Question WHY CORPORATIONS INVEST LO 1 Recording Acquisition of Bonds Cost includes all expenditures necessary to acquire these investments, such as the price paid plus brokerage fees (commissions), if any. ACCOUNTING FOR DEBT INVESTMENTS LO 1 Investments in government and corporation bonds. Entries are made to record the acquisition, the interest revenue, and the sale. Recording Bond Interest Calculate and record interest revenue based upon the carrying value of the bond times the interest rate times the portion of the year the bond is outstanding. LO 1 ACCOUNTING FOR DEBT INVESTMENTS Recording Sale of Bonds Credit the investment account for the cost of the bonds. Record as a gain or loss any difference between the net proceeds from the sale (sales price less brokerage fees) and the cost of the bonds. LO 1 ACCOUNTING FOR DEBT INVESTMENTS Illustration: Kuhl Corporation acquires 50 Doan Inc. 8%, 10-year, $1,000 bonds on January 1, 2017, for $50,000. The entry to record the investment is: Debt Investments 50,000 Cash 50,000 Jan. 1 LO 1 ACCOUNTING FOR DEBT INVESTMENTS Kuhl Corporation acquires 50 Doan Inc. 8%, 10-year, $1,000 bonds on January 1, 2017, for .

• Kế toán - Kiểm toán
• Lecture Accounting
• Financial statements
• Business organization
• Accounting information
• Analyzing investments
• Corporations purchase investments
• Financial accounting
• Lecture Financial accounting
• Management accounting
• Accounting standards
• Accounting equation
• Intermediate accounting
• Lecture Intermediate accounting
• Accounting process
• Accounting processing cycle
• Managerial accounting
• Accounting principles
• Fundamental accounting principles
• Lecture Fundamental accounting principles
• Merchandising operations
• Lecture Accounting 1
• Accounting for main transactions
• Accounting for purchases
• Accounting for sales
• Accounting for expenses
• Principle of accounting
• Lecture Principle of accounting
• The basic accounting equation
• Transaction analysis in accounting equation
• Calculate the accounting equation
• Lecture Advanced financial accounting
• Bài giảng Kế toán tài chính nâng cao
• Advanced financial accounting
• Accounting policies
• Accounting estimate
• Retrospective application
• Changes in accounting estimates
• Retrospective restatements
• Accounting assumptions
• Lecture Management accounting
• Bài giảng Kế toán quản trị
• Nature of management accounting
• Component of accounting system
• Financial system
• Lecture Accounting and financial system
• Ledger accounting
• Trial balance
• Completing the accounting cycle
• Accounting cycle
• Accounting worksheet
• Classified balance sheet
• Accounting changes
• Error corrections
• Accounting choices
• Accounting for business
• Lecture Accounting for business
• Accounting entity
• Classification of assets
• Accounting equation transactions