Question

22.

Highland Industries Inc. makes investments in available-for-sale securities. Selected income statement items for the years ended December 31, Year 2 and Year 3, plus selected items from comparative balance sheets, are as follows: There were no dividends. Determine the missing items. If required, use the minus sign to indicate a net or operating loss, un realized losses, or a credit balance in the valuation allowance account Highland Industries Inc. Selected Income Statement Items For the Years Ended December 31, Year 2 and Year 3 Year 2 Year 3 $ Operating Income (Loss) 6,770 (13,540) Gain (Loss) from Sale of Investments $(18,620) Net Income (Loss) Highland Industries Inc. Selected Balance Sheet Items December 31, Year 1, Year 2, and Year 3 Dec. 31, Year 1 Dec. 31, Year 2 Dec. 31, Year 3 Assets Available-for-Sale Investments, at Cost $160,790 $132,020 $115,090 8,460 (10,160) Valuation Allowance for Available-for-Sale Investments Available-for-Sale Investments, at Fair Value Stockholders' Equity Unrealized Gain (Loss) on Available-for-Sale Investments (11,850) Retained Earnings $277,570 $392,660

Answer 1

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a	First Solve b, and then a	$115,090-$6,770	$   108,320
b	$392,660-$277,570		$   115,090
c		$132,020+$8,460	$   140,480
d	same as valuation allowance		$        8,460
e		$115,090-$10,160	$   104,930
f	same as valuation allowance		$   (10,160)
g		-$18,620+$13,540	$      (5,080)
h	Same as unrealized gain or loss		$   (11,850)
i		$160,790-$11,850	$   148,940
j		$392,660-$18,620	$   374,040