At December 31, 2013, the available-for-sale equity portfolio for Steffi Graf, I

Question

At December 31, 2013, the available-for-sale equity portfolio for Steffi Graf, Inc. is as follows.

Security

Cost

Fair Value

Unrealized
Gain (Loss)

On January 20, 2014, Steffi Graf, Inc. sold security A for $16,459. The sale proceeds are net of brokerage fees.

Steffi Graf Inc. reports net income in 2013 of $130,800 and in 2014 of $152,600. Total holding gains (including any realized holding gain or loss) total $43,600.

(a) Prepare a statement of comprehensive income for 2013 starting with net income.

STEFFI GRAF, INC
Statement of Comprehensive Income
For the Year Ended December31, 2013

(b) Prepare a statement of comprehensive income for 2014 starting with net income.

STEFFI GRAF, INC
Statement of Comprehensive Income
For the Year Ended December 31, 2014

LINK TO TEXT

Security

Cost

Fair Value

Unrealized
Gain (Loss)

A $19,075 $16,350 $(2,725 ) B 13,625 15,260 1,635 C 25,070 27,795 2,725 Total $57,770 $59,405 1,635 Previous fair value adjustment balance—Dr. 436 Fair value adjustment—Dr. $1,199

Explanation / Answer

Net income 1,30,800 Other comprehensive income Unrealized holding gain arising during year 1,199 Comprehensive income 1,31,999 Net income 1,52,600 Other comprehensive income Holding gains arising during year 43600 Add: Reclassification adjustment for     loss included in net income(19075-16459) 2616 46216 Comprehensive income 1,06,384

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