Question

For the year ended December 31, 2018, Transformers Inc. reported the following: Net income   $180,000 Preferred...

For the year ended December 31, 2018, Transformers Inc. reported the following:

Net income   $180,000

Preferred dividends declared 30,000

Common dividend declared 6,000

Unrealized holding gain on available-for-sale securities, net of tax 3,000

Retained earnings, beginning balance 240,000

Common stock     120,000

Accumulated Other Comprehensive Income,

Beginning Balance 15,000

The balance of Accumulated Other Comprehensive Income that is reported on the balance sheet on December 31, 2018:

Select one:

a. $192,000

b. $18,000

c. None of the available choices

d. $12,000

Business   Accounting   
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Answer #1

Answer = 'B' $18,000.

Accumulated Other Comprehensive Income Beginning balance = 15,000
Add: Unrealised holding Gain on available sale of securities = 3,000
Balance of Other Comprehensive reported in balance sheet = $18,000   

Any Gain derived from securities available for sale , Foreign currency translation gains, pension plan gains, acturial gains on defined benefit plans, gain on derivatives held as cash flow hedges will be add back to the balance of other comprehensive income. also loss from these will be deducted.

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