User Account

All Pages

Compute change in wealth levels of each of four companies

Assignment Help Business Management
Reference no: EM131210827

The following information was extracted from the December 31, 2014, current asset section of the balance sheets of four different companies:

Wearever Fabrics Frames Corp. Pacific Transport Video Magic

Trading securities $800,000 $490,000 $645,000 $210,000

Available-for-sale-securities 130,000 40,000 250,000 85,000

Short-term equity invest. $930,000 $530,000 $895,000 $295,000

There were no transactions in short-term equity securities during 2015, and as of December 31, 2015, the controllers of each company collected the following information:

Wearever Fabrics Frames Corp. Pacific Transport Video Magic

Trading securities $820,000 $480,000 $625,000 $220,000

Available-for-sale securities 122,000 52,000 246,000 88,000

Short-term equity invest. $942,000 $532,000 $871,000 $308,000

a. Compute the change in the wealth levels of each of the four companies due to the market value changes in their equity investments.

b. Compute the effect on 2015 reported income for each of the four companies due to the market value changes in their equity investments.

c. Explain why the answers to (a) and (b) are not the same.

d.How would 2015 reported income change for each company if each chose to use the fair market value option for the available-for-sale securities?

Reference no: EM131210827

Questions Cloud

Explain the bretton woods exchange rate system : Briefly explain the Bretton Woods exchange rate system. - When was it created? - When and why did the system collapse?
The us dollar was the official reserve asset : Under the Bretton Woods system, the U.S. dollar was the official reserve asset. - How did this affect the U.S. balance of payments on current and capital accounts?
How is checkpointing done in aries : Give an example that illustrates how the paradigm of repeating history and the use of CLRs allow ARIES to support locks of finer granularity than a page.
What will happen to net exports : Given fixed exchange rates, advise the president of your country what will happen to net exports if the country pursues a policy of monetary expansion.
Compute change in wealth levels of each of four companies : Compute the effect on 2015 reported income for each of the four companies due to the market value changes in their equity investments.
What are international debt sources of funds : What are International debt sources of funds? Why are they important for success of large Indian companies? What are the risks associated and how can they be dealt
What will happen to balance of payments on current accounts : For each of the following situations, assuming fixed exchange rates, tell what will happen to the balance of payments on current and capital accounts in the United States, ceteris paribus:
Whether you agree or disagree with the given statement : Explain whether you agree or disagree with the following statement:"Flexible exchange rates allow nations to pursue their own monetary policies."
What are the advantages of fixed exchange rates : What are the advantages of fixed exchange rates? - What are the disadvantages? - Does it matter if the country is large or small?

Reviews

Write a Review

Business Management Questions & Answers

  What is your future plans

why did you choose to come to the USA specially, California of Lutheran University? What is your future plans ?

  Shwo the price skimming and price pentration

Explain the difference between price skimming and penetration pricing. Provide examples of when you may want to use each strategy.

  Employee development and organizational success

Explain how employee development contributes to an organizations success, who is responsible for employee development, and what types of training is involved.

  If the company has excess inventory or too little inventory

An essay to analyze the Pro-Forma data  (Foundations Simulation).  Provide an analysis of how the Erie Company ended its fiscal year. Items to discuss are inventory, meeting customer needs, production, capacity, marketing, and debt. There may be othe..

  Segmentation approach for the market

Develop a segmentation approach for the market of your product and provide rationale for why this approach is a good one.

  Investor-owned and not-for-profit corporations

Are there substantial differences between the finance goals of investor-owned and not-for-profit corporations? Explain.

  Catherine believes that he is always engaging in political

Catherine believes that he is always engaging in political activity that is not in the best interests of the college. She explains him as a man who passes the buck and who is scheming and arrogant. Bernice believes that the dean is an effective ma..

  Reward and recognition system to enable organization change

Prepare a final problem solution and proposal to executive management for implementation of a rewards system to support a change initiative in your organization.

  Traditional models of strategy

Explain how the five elements of strategy portrayed in the reading relate to either I/O or RBV traditional models of strategy?

  Describe how you would use excel to analyze this data

Describe how you would use Excel to analyze this data and organize it to prepare a written report

  Differentiate between audits tax and compilation services

differentiate between audits, tax, and compilation services

  What is the hgp

What is the HGP? What are the medical applications expected to result from this project or are presently in use as a result of this project. What are some of the ethical, legal and social issues that surround the HGP?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd