Question

Tax rate 21% Estimated tax payment 21,000 Investment cost and ending fair values for 20X1 and 20X2: 20X1 20X2 Cost 100,000 100,000 Fair value 110,000 134,000 Total gain 10,000 34,000 20X1 income statement information: Sales 1,670,200 Expenses 1,536,600 Assuming the investement is long-term, what is the accumulated other comprehensive income on the 20X2 balance sheet?

Answer 1

34,000

Step-by-step explanation:

The computation of the accumulated other comprehensive income on the 20X2 balance sheet is shown below:

In the given situation , since the investment is a long term and it would also be classified as an available for securities So if there is any unrealized gain or loss so the same would be reported

As we can see there is a gain of 34,000 in 20X2 so the same is to be shown in the accumulated other comprehensive income