13. At December 31, 2020, the equity investments of Sarasota Inc. that were accounted for using the FV-OCI model without

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13. At December 31, 2020, the equity investments
of Sarasota Inc. that were accounted for using the FV-OCI
model without recycling were as follows:
Ahn Inc.
Burnham Corp.
Chi Ltd.
Total
Because of a change in relationship with Ahn
Inc., Sarasota Inc. sold its investment in Ahn for
$153,700 on January 20, 2021. No other investments were
acquired or sold during 2021; however, a dividend of
$1,300 was received from Burnham Corp. in June. At December
31, 2021, the fair values of Burnham and Chi shares were
$153,900 and $73,000, respectively.
A) Prepare the entry to adjust the portfolio of investments to
fair value at December 31, 2020. (Credit account
titles are automatically indented when the amount is entered. Do
not indent manually. If no entry is required, select "No Entry" for
the account titles and enter 0 for the amounts.)
B) Prepare the presentation of all investment-related accounts
on the statement of financial position at December 31, 2020. Assume
that the balance of AOCI at December 31, 2019 is
zero. (Enter negative amounts using either a
negative sign preceding the number e.g. -2,945 or parentheses e.g.
(2,945).)
select an opening subsection name




Current AssetsTotal Current
AssetsShareholders’ EquityTotal Shareholders’ EquityTotal Long-term
InvestmentsLong-term Investments
select a balance sheet item




CashInventoryOther Current
LiabilitiesUnrealized Losses on FV-OCI InvestmentsUnrealized Gains
on FV-OCI InvestmentsInvestments in Equity Securities, FV-OCI
select an opening section name




Long-term InvestmentsTotal
Shareholders’ EquityTotal Current AssetsShareholders’ EquityTotal
Long-term InvestmentsCurrent Assets
select a balance sheet item




Total Accumulated Other
Comprehensive IncomeAccumulated Other Comprehensive IncomeTotal
Long-Term DebtLong-Term InvestmentsLong-Term DebtFixed Assets
select a balance sheet item




Unrealized Gains on FV-OCI
InvestmentsInventoryUnrealized Losses on FV-OCI
InvestmentsInvestments in Equity Securities, FV-OCIOther Current
LiabilitiesCash
C) Indicate what accounts and amounts would be reported on the
statement of comprehensive income for the year ended December 31,
2020, and where each would be reported. (Enter
negative amounts using either a negative sign preceding the number
e.g. -2,945 or parentheses e.g. (2,945).)
select a comprehensive income item




Other Comprehensive Income Item
that will be reclassified to net incomeComprehensive Income /
(Loss)Other Comprehensive Income Item that will not be reclassified
to net incomeNet Income / (Loss)Gross Profit / (Loss)
select an opening section name




Comprehensive Income / (Loss)Gross
Profit / (Loss)Other Comprehensive Income Item that will not be
reclassified to net incomeOther Comprehensive Income Item that will
be reclassified to net incomeNet Income / (Loss)
select a comprehensive income item




Holding Gains on
InvestmentsDividend RevenueUnrealized net loss on FV-OCI
investmentsUnrealized gain on FV-OCI investmentsInterest
Expense
select a closing name for this statement




Net Income /
(Loss)Comprehensive Income / (Loss)Other Comprehensive Income Item
that will not be reclassified to net incomeOther Comprehensive
Income Item that will be reclassified to net incomeGross Profit /
(Loss)
D) Prepare the journal entries for the 2021 sale of the
investment in Ahn Inc., including reclassifying holding gains or
losses to retained earnings and for the dividend received from
Burnham Corp. (Credit account titles are
automatically indented when the amount is entered. Do not indent
manually. If no entry is required, select "No Entry" for the
account titles and enter 0 for the amounts.)
E) Prepare the journal entry required at December 31, 2021, to
adjust the investments to fair value. (Credit
account titles are automatically indented when the amount is
entered. Do not indent manually. If no entry is required, select
"No Entry" for the account titles and enter 0 for the
amounts.)