Reference no: EM132871784

Question 1 - In September 30, 2020, Reveal Ltd. invested excess cash in the shares of Adam Company. It acquired 2,000 shares at $45 each. On December 31, 2020, and December 31, 2021, the shares of Adam were trading at $36 and $51 per share, respectively.

Required - Assuming the investment in Adam is classified as Fair Value Through Other Comprehensive Income (FVTOCI), prepare all required journal entries in 2020 and 2021.

Question 2 - The following is an alphabetical list of account balances at December 31, 2021 for The Best Corporation. The company did not declare any dividends in 2021.

Building 850,000

FVTOCI investments 120,000

Capital Stock 702,000

Cash 50,000

Cost of goods sold 650,000

Inventories 96,000

Depreciation expense 49,000

Dividends payable 8,000

Supplies 16,000

Income tax expense 80,000

Insurance expense 9,000

Interest expense 35,000

Accumulated depreciation - equipment 120,000

Unearned revenues 63,000

Interest income 17,000

Interest payable 16,000

Interest receivable 9,000

Accounts payable 140,000

Accounts Receivable 89,000

Accumulated depreciation - building 230,000

Land 650,000

Long-term bank loan 590,000

Patents 125,000

Equipment 560,000

FVTPL investments 129,000

Prepaid expenses 16,000

Rent expense 23,000

Bonds payable, due December 31, 2028 260,000

Retained Earnings (beginning of year balance) 310,000

Salaries expense 130,000

Sales 1,230,000

Required - Prepare Statement of Financial Position for 2021.