Ask Question
BusinessBusiness
20 October, 06:42

Sloan Company has owned a debt securities investment during 2021 that has increased in fair value. After all closing entries for 2021 are completed, the effect of the increase in fair value on total shareholders' equity would be:

+5
Answers (1)
  1. 20 October, 07:35
    0
    This securities investment classifies as unrealized gains, as it has to be reported in the balance sheet under shareholder equity in the Accumulated Other Comprehensive Income account.

    Explanation:

    Unrealized gains (or losses) only exit on paper, since the company cannot recognize the gains until it sells the securities. It is an estimate of the profits that the company can make when it sells the securities, but until it does, they cannot be included in the income statement.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Sloan Company has owned a debt securities investment during 2021 that has increased in fair value. After all closing entries for 2021 are ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers
You Might be Interested in
Diana sold mutual fund shares she had owned 4 years so that she could use the proceeds to travel across Europe with her son. Diana is in the 35% marginal tax bracket and her capital gains from this sale were $30,000.
Answers (2)
You are considering investing in a no-load mutual fund with an annual expense ratio of. 6% and an annual 12b-1 fee of. 75%. You could also invest in a bank CD paying 6.5% per year.
Answers (2)
Indicate the effect of each of the following transactions on (1) the current ratio, (2) working capital, (3) stockholders' equity, (4) book value per share of common stock, and (5) retained earnings. Assume that the current ratio is greater than 1:1.
Answers (1)
1. The common stock of Textile Mills pays an annual dividend of $1.65 a share. The company has promised to maintain a constant dividend even though economic times are tough.
Answers (1)
Alpha Company purchased, on account, 3,500 pounds of raw materials at $9 per pound on January 2, 2017. The production manager requisitioned and received 2,500 pounds of raw material into production on January 15.
Answers (1)
New Questions in Business
It is important to identify and use only incremental cash flows in capital investment decisions:A) because they are the simplest to identify. B) only when the stand-alone principle fails to hold.
Answers (1)
You have just won a lottery! You will receive $50,000 a year beginning one year from now for 20 years. If your required rate of return is 10%, what is the present value of your winning lottery ticket
Answers (1)
You want to invest in a project in Canada. The project has an initial cost of C$828,000 and is expected to produce cash inflows of C$355,000 a year for three years. The project will be worthless after the first three years.
Answers (1)
When comparing the three broad types of economic systems, it can be said that for a pure market economy to function efficiently, product supply must be restricted.
Answers (1)
Agency problems are most associated with: Multiple Choice 1. limited liability companies. 2. limited partnerships. 3. corporations. 4. sole proprietorships. 5. general partnerships.
Answers (1)
Home » Business » Sloan Company has owned a debt securities investment during 2021 that has increased in fair value. After all closing entries for 2021 are completed, the effect of the increase in fair value on total shareholders' equity would be:
Sign Up Forgot Password?