Though bonds have usual market risk credit risk is minimal., Ask an Expert

Accounting

Answer the following problems with regard to preparation of fund financial statements. At fiscal year-end, city holds investment portfolio in its general fund which has fair market value of $15 million and historical cost of $28 million. Portfolio had fair value of $18 million at the starting of present fiscal year. Portfolio is composed of variety of bonds with face value $29 and due date five years in future. Bonds were acquired to meet a $29 million debt due five years in future. Though bonds have usual market risk, credit risk is minimal.

Required:

a) At what amount must the portfolio be valued on balance sheet?

b) What amount, if any, must appear on operating statement?

c) Defend valuation method required by GAAP.

d) Argue against valuation method required by GAAP.

e) At what amount would City want to record investments on their financial statements? describe why?

View complete question

Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M917858

Have any Question?Write your Review or question?

Related Questions in Accounting Basics

Question - aja could tell that this patron was not her

Question - Aja could tell that this "patron" was not her store's usual type. She could see he did not care about fashion, and the customers that came to her shop in the Jacksonville mall were all tuned in to the latest s ...

Question - on march 1 2017 boyd company acquired real

Question - On March 1, 2017, Boyd Company acquired real estate, on which it planned to construct a small office building, by paying $80,000 in cash. An old warehouse on the property was demolished at a cost of $8,200; th ...

Discussion accounts receivablesfinancial accountingaccounts

Discussion: "Accounts Receivables" Financial Accounting Accounts Receivables • What is the importance of the turnover of Accounts Receivables? • Why is it is essential for organizations to keep cash reserves on hands? • ...

Question - stellar company manufactures equipment stellars

Question - Stellar Company manufactures equipment. Stellar's products range from simple automated machinery to complex systems containing numerous components. Unit selling prices range from $200,000 to $1,500,000 and are ...

Question decision making with managerial accountingdue to

Question: Decision Making with Managerial Accounting Due to varying business characteristics, the managerial accounting techniques applied in each business may differ. For example, a business in the start-up phase may re ...

Question - segment income statementsnutty co gourmet snacks

Question - Segment Income Statements Nutty Co. Gourmet Snacks has two divisions: Gift Baskets and Packaged Snacks. For first quarter 2018, Gift Baskets had a revenue of $1,125,000 and Packaged Snacks had a revenue of $75 ...

Question - barbara whitley had great expectations about her

Question - Barbara Whitley had great expectations about her future as she sat in her graduation ceremony in May 2010. She was about to receive her Master of Accountancy degree, and next week she would begin her career on ...

Question - in 2013 emily invests 100000 in a limited

Question - In 2013, Emily invests $100,000 in a limited partnership that is not a passive activity. During 2013, her share of the partnership loss is $70,000. In 2013, her share of the partnership loss is $50,000. How mu ...

Question - domingo entity entered into a contract to

Question - Domingo Entity entered into a contract to exchange a liability. However, this particular liability does not have a quoted price in Domingo's principle market. Sabado Entity holds an asset similar to the liabil ...

Question - flounder corporation sold 3490000 7 5-year bonds

Question - Flounder Corporation sold $3,490,000, 7%, 5-year bonds on January 1, 2017. The bonds were dated January 1, 2017, and pay interest on January 1. Flounder Corporation uses the straight-line method to amortize bo ...

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Accounting Basics Expert