Question

Cullumber Corp. invested its excess cash in securities during 2020. As of December 31, 2020, the securities portfolio consisted of the following common stocks.

Security		Quantity				Cost		Fair Value
Lindsay Jones, Inc.		1,000 shares				$15,100		$21,100
Poley Corp.		2,000 shares				39,700		41,700
Arnold Aircraft		2,000 shares				71,300		59,500
				Totals		$126,100		$122,300

What should be reported on Cullumber’s December 31, 2020, balance sheet relative to these securities? What should be reported on Cullumber’s 2020 income statement? (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Cullumber Corp. Balance Sheet (Partial)                                                                       December 31, 2020For the Year Ended December 31, 2020For the Quarter Ended December 31, 2020
Current AssetsCurrent LiabilitiesIntangible AssetsEquity InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentStockholders' EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders' EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Stockholders' Equity
		$

Income Statement                                                                       December 31, 2020For the Year Ended December 31, 2020For the Quarter Ended December 31, 2020
DividendsExpensesNet Income / (Loss)Retained Earnings – January 1, 2022Retained Earnings – December 31, 2022Sales RevenuesTotal ExpensesTotal RevenuesNet SalesGross ProfitOperating ExpensesTotal Operating ExpensesIncome From OperationsOther Revenues and GainsOther Expenses and LossesIncome Before Income Taxes
			$

  On December 31, 2021, Cullumber’s securities portfolio consisted of the following common stocks.

Security		Quantity				Cost		Fair Value
Lindsay Jones, Inc.		1,000 shares				$15,100		$19,800
Lindsay Jones, Inc.		2,000 shares				33,300		40,300
Duff Company		1,000 shares				16,200		11,900
Arnold Aircraft		2,000 shares				71,300		22,100
				Totals		$135,900		$94,100

During the year 2021, Cullumber Corp. sold 2,000 shares of Poley Corp. for $37,900 and purchased 2,000 more shares of Lindsay Jones, Inc. and 1,000 shares of Duff Company.

What should be reported on Cullumber’s December 31, 2021, balance sheet? What should be reported on Cullumber’s 2021 income statement? (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Cullumber Corp. Balance Sheet (Partial)                                                                       December 31, 2021For the Year Ended December 31, 2021For the Quarter Ended December 31, 2021
Current AssetsCurrent LiabilitiesIntangible AssetsEquity InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentStockholders' EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders' EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Stockholders' Equity
		$

Cullumber Corp. Income Statement (Partial)                                                                       December 31, 2021For the Year Ended December 31, 2021For the Quarter Ended December 31, 2021
DividendsExpensesNet Income / (Loss)Retained Earnings – January 1, 2019Retained Earnings – December 31, 2019Sales RevenuesTotal ExpensesTotal RevenuesNet SalesGross ProfitOperating ExpensesTotal Operating ExpensesIncome From OperationsOther Revenues and GainsOther Expenses and LossesIncome Before Income Taxes
		$

  

On December 31, 2022, Cullumber’s securities portfolio consisted of the following common stocks.

Security		Quantity				Cost		Fair Value
Arnold Aircraft		2,000 shares				$71,300		$82,000
Duff Company		500 shares				8,100		5,900
				Totals		$79,400		$87,900

During the year 2022, Cullumber Corp. sold 3,000 shares of Lindsay Jones, Inc. for $40,100 and 500 shares of Duff Company at a loss of $2,700.

What should be reported on the face of Cullumber’s December 31, 2022, balance sheet? What should be reported on Cullumber’s 2022 income statement? (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Cullumber Corp. Balance Sheet (Partial)                                                                       December 31, 2022For the Year Ended December 31, 2022For the Quarter Ended December 31, 2022
Current AssetsCurrent LiabilitiesIntangible AssetsEquity InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentStockholders' EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders' EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Stockholders' Equity
		$

Cullumber Corp. Income Statement (Partial)                                                                       December 31, 2022For the Year Ended December 31, 2022For the Quarter Ended December 31, 2022
DividendsExpensesNet Income / (Loss)Retained Earnings – January 1, 2020Retained Earnings – December 31, 2020Sales RevenuesTotal ExpensesTotal RevenuesNet SalesGross ProfitOperating ExpensesTotal Operating ExpensesIncome From OperationsOther Revenues and GainsOther Expenses and LossesIncome Before Income Taxes
		$

  

Answer 1

Answer-1:

Cullumber Corp. Balance Sheet (Partial) December 31, 2020 Current Assets: Equity investment $ 122,300 Income Statement For the Year Ended December 31, 2020 Other expenses and losses: Unrealized holding gain or loss-Income (3,800)

Answer-2:

Cullumber Corp. Balance Sheet (Partial) December 31, 2021 Current Assets: Equity investment $ 94,100 Income Statement For the Year Ended December 31, 2021 Other expenses and losses: Unrealized holding gain or loss-Income Loss on sale of investment (39,700 - 37,900) $ (38,000) (1,800)

Working Note: Lindsay Duff Total Lindsay 21,100 Arnold 59,500 19,800 (1,300) 33,300 40,300 7,000 22,100 (37,400) 16,200 11,900 (4,300)| (36,000) FMV (2020) Cost FMV (2021) Unrealized gain(loss) Less: reversal of Poley's unrealized gain(loss) Total unrealized gain(loss) for 2021 (2,000) (38,000)

Answer-3:

Cullumber Corp. Balance Sheet (Partial) December 31, 2022 Current Assets: Equity investment $ 87,900 Income Statement For the Year Ended December 31, 2022 Other expenses and losses: Unrealized holding gain or loss-Income $ Loss on sale of investment 50,300 (11,000)

Working Note: Total Arnold 22,100 82,000 59,900 Duff 5,950 5,900 (50) 59,850 FMV (2021) FMV (2022) Unrealized gain(loss) Less: reversal of Landsay's & Duff's unrealized gain(loss) gain(loss) for 2022 (9,550) 50,300