10 Evaluation Essay Topics on Medical Ethics

10 Evaluation Essay Topics on Medical Ethics Medical ethics is an important issue that arises more often and more controversial with progression of human history. If you are writing a medical ethics evaluation essay, consider the ten facts below: Palliative care in a medical facility can result in critical ethical matters the physician must consider. A patient is legally allowed to refuse treatments which will sustain their life, even if that refusal leads to their death. Here, the patient has to be able to understand all of the options at hand, as well as the risks and benefits to all options. The patient must also be able to rationalize and name the treatment they have selected. There are three elements to educated refusal as well as consent to treatment where practitioners can sustain life and that is if the freedom of the patient is coerced, if the patient does not have the ability to make an informed decision, or if the conveying of the information to the patient is not possible. Each nurse is held to different ethical standards in their practice. ADN nurses are tasked with communicating and collaborating with patients as well as their families. They must also work with the medical team to plan, deliver, and coordinate the patient-centered care for all of the assigned patients. RN’s with an ADN must participate as an advocate for the activities that would improve the lives of their patients and help to identify the needs of patients and refer them to the resources that might offer better care after they leave the hospital. It is part of the job of the RN’s with an ADN to ensure complete confidentiality for the patients. They are required in this instance to communicate and collaborate with all members of the health care team assigned to this man’s care in a collective effort to ensure optimal health. The RN’s with an ADN would have to use any supporting technology needed to communicate the patient’s situation and what care i s necessary while also assigning the appropriate nursing care and supervising the nurse responsible. Different medical practitioners rely upon different theories of practice in order to make sure they are acting in an ethical fashion at all times. The â€Å"need theory† emphasizes the importance of increasing the independence of patients in order to promote continued healing after their hospitalization. It was this â€Å"need theory† which was the first distinction made between medicine and nursing. The unique function of nurses was to assist a patient in whatever activities contributed to health or recovery. Nurses give patients, in this context, the strength, the knowledge, or the will to perform such basic tasks unaided. This idea really emphasizes getting into the mind of the patient to help them better heal physically. The Henderson nursing theory stated that the patient required assistance in order to achieve health, regain their independence, or have a peaceful death. The patient and their families needed to be viewed as a single unit, and it was important for nurses to know that the body and mind were inseparable and they needed to be treated as such. She emphasized how the quality of mental health would allow an individual to heal more rapidly (Henderson, 1966). She went on to state that patients wanted to learn, discover, and satisfy their natural curiosity so that they can better develop their health, something that is emphasized in the BSN program. As a nurse, applying Henderson’s â€Å"need theory† requires first assessing the basic needs of the individual. Then a nurse must identify the ability of the individual to meet their needs with or without help, taking into account their knowledge, their will, or their strength. They must then document how best to assist the individual. Implementing of treatment prescribed by a physician should be done by taking into account what activities need to be achieved in order to recover from an illness, maintain health, or aid in a peaceful death. The implementation as a nurse should be based on emotional balance, age, cultural background, physical capacities, or emotional capacities. An evaluation should be done to determine the speed with which a patient can perform tasks or the degree to which a patient can perform tasks in an independent fashion, such that they can eventually meet their goals for recovery or a peaceful death (Henderson, 1997). When working with different cultures, it is important for medical practitioners to communicate with parents, and to take certain beliefs into consideration of the parents in the cause and treatment of disease. In Hmong culture parents are open to discussing the name of the problem, as well as what they considered to be the cause. They believed they knew at what point the problem started, but their answer is not necessarily a medical one which Western doctors are trained to address. The parents obviously respect the roles of healers and those roles were highly sacred, which is why they assumed that the doctor would have the solution or the treatment for the problem, and in asking the questions the doctor was obviously open to improving his education of the Hmong medicinal ways so as to afford better treatment that would best bridge the two worlds. However, many Hmong believe that doctors should just know the answers themselves if one is a a good doctor he/she will know without having to speak with the parents. In western medicine there is an ethical dilemma with regard to cultural sensitivity such that there exists exploitation of the natural birthing periods for women, something which Western society today would view as backward because it is not legal. However, the high birth rates, and high birth rates in hospitals can be problematic for Western medical practitioners when working with Hmong people for example. It can be particularly shocking that contraceptives would not be used, especially among the converts, or that no matter the changes in their environment or where they were living, they would stick to their traditional roles of early marriage and multiple children. It is imperative for those whose responsibilities involve children, health or social care matters to fully understand the true meaning of ethical care and the right way to implement such concept in their daily roles and work responsibilities. To put it simply, ethical care is actually a responsibility that is governed by law that requires any individual to at all times upheld the standards of reasonable care when they are carrying out their duties that have the possibilities of hurting others. In this relation, such individual must be sure to check that the internal and external surroundings are safe before commencing any morning sessions. Implementing a cleaning roster is one way to make sure that the gathering conducted in a clean environment. Everyone is familiar with the phrase Do not judge a book by its cover. As a society, we pay lip service to the idea that it is wrong to judge people by the way they look. However, this idea becomes this idea is becoming increasingly important in the medical workplace. In private, a person may - rightly or wrongly - make all the judgments he wants and hold whatever opinions he chooses. In a work environment, however, that same person represents the adult social care organization for which he works. It is nowadays vital that a healthcare organization would be viewed as operating ethically. If a medical organization were to acquire a reputation as being unethical, it would have terrible effects on that adult social care organization’s ability to do medical care. Customers, after all, tend to prefer to work companies they like and feel they can trust. A reputation for solid ethics, then, is vital to a medical organization’s bottom line. We hope that these facts will make your writing easier. Use them along with our list of 20 sample topics and a guide on evaluative essay writing. References: Fadiman, Anne.  The Spirit Catches You And You Fall Down. New York: Farrar, Straus, and Giroux, 1997. Print. Finn, Jeffrey and Eliot Marshall.  Medical Ethics. New York: Chelsea HousePublishers, 1990. Print. Häring, Bernhard.  Medical Ethics. Print. Henningfeld, Diane Andrews.  Medical Ethics. Detroit, Mich.: Greenhaven Press, 2011. Print. Henderson, V. (1961). Basic principles of nursing care. London: [International Council of Nurses]. Henderson, V. (1966). The nature of nursing; a definition and its implications for practice, research, and education. New York: Macmillan. Henderson, V. (1997). Basic principles of nursing care (Rev. 1997. ed.). Geneva, Switzerland: International Council of Nurses.

Meastro by Peter Goldsworthy essays

Meastro by Peter Goldsworthy essays Although music is an integral part of Maestro, the novel is essentially a story about a boys journey into adulthood. Maestro shows us that maturity is gained only through suffering as the novel focuses on the coming of age of Paul Crabbe, who is led on a journey of personal discovery. In the beginning of the novel Paul is corrupted by pride and the idea that he is great, he might even think he is almost perfect. This self-satisfaction does wonders to boost his ego, as he predicts instant fame and fortune will come to him. When he first meets Keller, he acts as if he knows everything, but Keller mocks him constantly with such comments as, you know so much for your age...and so little, and wont give in to his superficial ideals. Paul is at the crossroads between childhood and adulthood and draws on his experiences, relationships and interactions with other characters to teach him invaluable lessons. Paul particularly draws on his music teacher Herr Eduard Keller, his parents and their musical influence, and also his peers to determine his direction in life. Music is an on-going and interweaving motif throughout the novel, and is also the most important one. Music is the glue which bonds many relationships in the novel; Paul and Rosie's, Paul and the band's, Paul a nd Mr Keller, and Paul's parents. Through music, Paul was able to learn a lot - mostly from Keller In the beginning we are shown that Paul already has very little respect towards Herr Eduard Keller. Before Paul had even the chance to speak to Keller, he is already judging him by his appearance: a boozers incandescent glow. The pitted, sun-coursed skin a cheap ruined leather. This shows Pauls arrogance. Pauls attitude towards Keller changes however towards the end of 1967 and he starts to gain a little bit of respect for him but, as Paul is commonly known to act, he tries to impress Keller in order to gain some resp...

A Systems Approach to the Exploration of Challenges of Online Distance Literature review - 2

A Systems Approach to the Exploration of Challenges of Online Distance Education in the context of Saudi Arabia - Literature review Example Reinforcing is the process by which the different components of a system are put into action. Balancing process makes sure that every component of a system is in equilibrium with each other. Feedback forms an integral part of the sytems thinking approach. For instance while analyzing a project on human resource; the management is considering increasing the number of employees in the organization, however past results show that increasing the number of workers has proven to be counterproductive. Therefore in such a scenario the firm must take into consideration feedbacks generated from past actions to analyse the current system (Checkland and Poulter, 2010). Sytems thinking was founded in the year 1956 by the MIT professor Jay Forrestor. Forrestor had recognized that there was a need of a better way of testing new ideas and aspects of the social system like in the manner how ideas are tested in engineering. In traditional forms of analysis, a system in broken up into different parts and then studied. In case of sytems thinking, a system’s parts are analysed on the basis of how they interact with each other in order to produce behaviour (Checkland and Winter, 2006). System thinking emphasizes upon the proper usage of input so that the desired results can be obtained. In case of analyzing a project as a system, the inputs are capital, labour, machines materials and time. The desired output can be in the form of services and products. The systems thinking approach induces the detailed analysis of each aspect of the action plan that is formulated to achieve the desired results. Therefore the management needs to consider the critical success factors and the impact of the external environment upon the operations. The systems theory brings stability in the operations of an organization which otherwise can be chaotic as the business environment, both internal and external are constantly changing. The systems approach also

Cost and Value Management Case Study Example | Topics and Well Written Essays - 2000 words

Cost and Value Management - Case Study Example This certainly shows the pragmatism of the firm with regards to its products in the sense that none of the products are rushed into production whatever the results these said products show on the testing phase. That is directly linked to the cost management practices of the firm i.e. the firm is willing to bear some short-term costs given that these cost can initiate the birth of products that are successful and long-lasting in the long run. In addition, the entire case of the Boeing 7X7 shows the commitment and drive of Boeing towards research and development. It says in the case study before the name was changed to 767, approximately $100 million had been spent on this project which were demarcated as costs for the on-going research and development. Therefore, we can see that the costs management practices of Boeing had a significant place in them for large scale research and development projects. Suffice to say, the cost management practices of Boeing are pragmatic yet expansive a nd directed towards the long run. [1] [2] [3] Now, after determining these facts, we will now look at the strengths and weaknesses of these practices of Boeing in light of the concept of earned value management. Before, I delve much deeper into this topic, it is critical to explain that contrary to popular belief, there is a world of difference between the factors that determine earned value and earned value management systems (EVMS). ... ts importance vis--vis the mechanism can be gauged by the fact that large adapt ably priced military defense contracts have required the presence of these prerequisites in order to ascertain the reliability of the results given by the earned value metric as far back as 1967. It is important to note that despite the great important of these prerequisites, they are not essential for the workability of the earned value method. However, the presence of a management control system that fulfills at least part of the standards that have been demarcated by the prerequisites is extremely essential in this case. From here on, the term "earned value management process" will include the pre-requisites for both the earned value and the EVMS criteria. [4] [5] [6] I will first look at the strengths of these practices at Boeing. The earned value approach of Boeing is directly in line with the cost management practices that we have seen in the case study. Despite the very large initial expenditure that is related to the product, the project only went into productions when commitments to purchase were received from one foreign and two domestic airlines, and preproduction orders totaled at least 100 planes. This showed the risk management abilities of the company in the sense that they wanted to ascertain to the minimum a certain number of prospective clients which would be interested in their products. This also showed the strengths of the earned value management process of the business as they want to determine a flexible budget of costs which they would need to undertake in order to complete a theoretical number of orders. Now, this theoretical number would be based on the pre-posed number of prospective clients who had guaranteed their intere st to purchase. Therefore, the entire

9Live strategic analysis - general environment Essay

9Live strategic analysis - general environment - Essay Example Being one of the leading innovators in the realm of interactive T.V, 9Live seems to targeting every person. Since it is primarily a quiz TV channel and can be accessed through internet therefore its demographic study includes most of those viewers who are either fond of using technology or having some tendencies to gamble. Besides, the concept was of an interactive T.V. running without advertisement revenues therefore there was an strong tendency that channel must lure people from all walks of life to constantly call in during all time of the day so that a constant flow of revenue is insured. Since It was largely believed that solving crossword puzzles, or answering quiz shows was the job of those who probably are of old age or unemployed therefore demographical factors present a different challenge to 9Live. Germany is by far the largest economy in Europe. 9Live emerged on the scene when German market was not developed for the concept of interactive T.V. however emergence of shopping channel like of H.O.T. was suggesting a change in the industry dynamics. Germany is one of the most critical and important members of the European Union as for as the economy is considered. Government deficits in budgets were virtually not existening however Germany was marred by low GDP growth i.e. 0.7% in 2001 when the channel was launched whereas unemployment level was at 9.5% suggesting strong downturns in the economy. (Ewing). Clearly, the downward turn in the business cycle is hitting Germany hard. But this is more than just a cyclical bout of bad news. It was largely believed that the economic efforts at that time were stalled as Germanys 3.9 million unemployed was heading no way. Apart from that the period of 9Live launch was marred mainly by recession in the economy of Germany and due to widening u nemployment gaps, the probability of attracting the paid callers seems to be low no matter how cheap it can be. Though German media

Casual Internet Gamers in India

Casual Internet Gamers in India Casual Internet Gaming in India is the area of dissertation which will be researched. A phenomenon relatively new to the world, casual internet gaming is an area which is yet to be researched and fully understood. Computer gaming is an area close to my heart, as well as an exciting and challenging field to work on, where the markets are still evolving and promising great potential in the near future. Electronic gaming itself is a very wide subject which hasnt been properly researched, especially in India. Internet gaming is a subset to it, but again an area so vast that it cant be covered in one research. Going down further, I chose casual internet gaming because of the following reasons- Casual gaming is by far the most popular mode of gaming on internet in India. Internet speeds in India allows only casual gaming to grow currently. Social media is proving to be an ideal platform for their growth No research on this topic has been done so far. We are yet to understand why people and Indians in particular are attracted towards casual gaming. Till now, Indian Marketers have not taken a consumer-centric approach to make and deliver casual games. There is great scope in the field, as Indians discover casual gaming and get hooked on to it through various platforms According to a recent study by JuxtConsult , Of the 47 million Internet users, 39 million are based in urban areas, while only 8 million reside in the rural. Hence Internet penetration is largely limited in India and speeds are still slow. In such a scenario, the only games that can work well are casual games because they dont need high end computer/gaming systems, nor are the speed requirements a constraint. In fact, being the only mode of gaming which is viable, it has been the focus of the gaming industry as well. From dedicated websites like zapak to integration of casual games to social media networks like facebook, casual games are available across the internet. The surprising part is that no one has really tried to understand the reason for their popularity or the potential profitability of these games. The growth of Indias casual games market comes in line with the overall growth of the countrys games market and industry. According to founder of CasualGaming.biz, Gaurav Mirchandani the industry has changed substantially over the past few due to the growth of internet users in India whom now have broadband access in their homes, at work, and in restaurants and hotels. This change has sparked a new emergence of casual gaming in India as a leisure and as lead to new small companies setting up offices for game development outsourcing mostly for flash and PC downloadable games. The Industry focus has been on delivering casual games across platforms to the maximum possible user base. However, no thought has been given to the consumer and their needs. The Industry lacks a consumer-centric focus in game development and delivery. A deeper understanding of why these games are being played, and by whom they are being played is necessary to improve the standards and profitability of casual gaming as a business. As the world moves towards the virtual avenues provided by the technological revolution, internet gaming assumes significance as the next major frontier of the world. Brands are already investing in this area and can really cash on into this profitable business. Internet now provides people the choice of playing with other individuals over the cyber space. The constant advances in technology open up new possibilities regularly, taking computer gaming to new heights each time. Hence, the objective of the research will be to understand the psyche of the Indian casual gamer. This will help the Indian gaming industry understand the consumers better and hence deliver better products to them. Not only that, it will also help them improve the profitability of the business, by understanding what is relevant to the gamers, and what is not. This will be an exploratory study into the realm of casual gaming in India. Given the time constraints of a dissertation, I will be able to focus on limited aspects of casual gaming. Hence I am choosing only those aspects of the area, like why do gamers behave as they do and where and when they play games, which are important both for the Industry and the academia. Again due to the time constraints and vastness of the topic, everything cannot be covered in one research. Hence a study on the college-going gamers will be conducted. LITERATURE REVIEW Very little literature is available on consumers of Casual Gaming in India. I studied the gaming industry in general to find references to casual and internet gaming, especially in the Indian context. Gaming: India is All Set! -Rao, K. Rajesh (rajesh, 2008) Prospects for Animation Gaming Industry in India. -Kuruvila, A. O. (A.O, 2008) (Computer gaming on the go in India, 2004) India: The Final Frontier for Games? (Silicon india, 2008) Zapak Taking Casual Games seriously! (Vimali, 2008) Casual Gaming A Big Draw for VCs. (Khanna, 2008) Games people play (Marketing Management, 2007) Casual video gaming is now serious business (2007) Casual Computer Games Go Upscale (2007) Nothing casual about it Rajiv Fernando 2009 The article presents the authors views concerning the development of the gaming industry in India. He relates that the new generation is characterized by the evolution of interactive digital content and distributed model of games services. The author perceives good opportunities for game developers and providers associated with the increase of Internet penetration and digital content. The article starts off with a preface of the Global and Indian gaming and animation industry and goes on to dwell upon the statistics of the industry in India. It then follows up with a SWOT analysis of the Indian gaming Industry Reports on the report released by British Broadcasting Corp. in 2005 regarding the mobile gaming market segment in India. Increase in the number of mobile phone users in October 2004; Factors that influenced the growth in the mobile gaming sector; Number of game developers and mobile companies that provide games to their subscribers. The article provides an overview of the computer games industry worldwide, particularly in India. It explains the technology trends that might influence the advent of these games including powerful cellular telephones, cloud gaming and the growth of broadband networks. A historical background on the emergence of these electronic games is also presented. The article discusses the success of the online games introduced by Zapak Digital Entertainment in India. Zapak is influential to the success of the gaming industry through the launching of massive multiplayer online games (MMOGs), hardcore games and large format gaming cafÃÆ' ©es. The companys strategies in creating value chain for its customers and distribution network are mentioned. The article presents the views of the author on various issues related to the electronic games industry in India. It focuses on the casual gaming business. The author addresses the problems on piracy and financing animation and gaming projects in the country. Future opportunities for the casual gaming space are also cited. The article discusses conflicting studies concerning the target audience for casual games. A study by Information Solutions Group found that casual gamers are predominately female. In-game advertisement firm Eyeblaster backed this data up, claiming that the majority of casual gamers are females that are more than thirty years old. However, a study by Ipsos Insight showed that more than half of computer and video gamers are male, data that is backed up by a Universal McCann study about console gamers. The article reports on the growing competition among firms in the video games industry in New York City. According to IDC Research, revenues from casual video games are expected to increase by 68 percent to $750 million in 2007 and are forecasted to reach $2 million by 2009. Wade Tinney, co-founder of Large Animal Games, said that it is important for firms in the industry to be well-funded so that they can move quickly and make products that compete with those with other companies. The article talks about the demographics of casual gamers worldwide according to the various studies that have been conducted. It also talks about the distribution of these games and what the game developers are doing to fight off competition in the casual gaming segment. It takes the zapak example to show that casual games are here to stay. It further tells about the future plans of zapak and compares the groeth of casual gaming in India with increase in internet penetration.It re-iterates that industry observers believe that online games had great potential for growth in the Indian gaming market, as it overcame the problem of piracy. Sify eyes kids for gaming biz (2007, Infotech.indiatimes.com) Web 2.0: Online Communities, Personalization and the Web OS. (Singh, 2006) Casual Games White Paper -IGDA ,2003 The 2009-2014 Outlook for PC Casual Games in India Icon Group International, Inc. 2008 Insights on Casual Games, Nielson, 2009 Casual gaming study conducted by NPD Group China Gaming 2008à ¢Ã¢â€š ¬Ã¢â‚¬Å"2012 Forecast and Analysis Casual Gaming Market Update James Kuai and Peter Shackelfor 3Q 2007 2004 China Casual Game Research Report (2005) It shows the interest of the industry in the casual gaming industry and an attempt to focus on the needs of the consumers, finally. I talks about Sify and its plan to acquire casual games and make them available all across Sifys cyber cafes. The article reports developments on Web 2.0 in India. Social networks and casual gaming continue to prevail in the major themes of Web 2.0. Online communities emphasize the notion of more sharing and connectivity on the Internet, as well as a strong focus on personalization. Another interesting phenomenon in the Web 2.0 world is the emerging space of online casual gaming. This article is on the International Casual Games industry. Numerous players continue to enter the market, business models are constantly changing, and new customers are found every day. This paper helps define the industry, and give everyone a base level of understanding of all aspects of this space. It is not intended to go into minute detail on any one subject, but provides broad understanding to the major factors involved in the casual game industry. This econometric study covers the latent demand outlook for PC casual games across the states, union territories and cities of India. Latent demand (in millions of U.S. dollars), or potential industry earnings (P.I.E.) estimates are given across over 5,000 cities in India. This report does not discuss the specific players in the market serving the latent demand, nor specific details at the product level. Nor does the report cover actual sales data (which are simply unavailable, in a comparable or consistent manner in virtually all of the cities in India) This study looks at data from more than 800 casual games for PC computers, which are defined as inexpensive to produce, straightforward in concept, easy to learn and simple to play. They say that casual gamers return more often to games and therefore play more often than hardcore gamers. The study, which surveyed nearly 3,000 U.S. gamers, identified 14 specific types of gamer within 39 different game genres. Casual gamers were divided into 10 classifications. The study also offered data that would seem to dispel the myth that casual gamers dont invest as much time playing games as core gamers do. This IDC study examines the dynamics of the China gaming market and focuses on online gaming. It looks at market drivers, dynamics, and strategies; the competitive landscape; and includes profiles of the top 10 vendors as well as a 2008à ¢Ã¢â€š ¬Ã¢â‚¬Å"2012 forecast. The concentration of the China online gaming market improved significantly in 2007. The revenue sum of the top 10 vendors occupied 91.8% of the total market. Casual Gaming Market Update provides in-depth analysis of the current dynamics and future directions of the rapidly growing casual gaming industry in the USA, including quantitative forecasts, competitive analysis, consumer perspectives, and profiles of leading companies in the casual gaming value chain. According to iResearch, market size of China online casual game industry was RMB 25 million in 2003 and it reaches to RMB 410 million in 2004 with growth rate of 356%. The fast growth of online casual game industry is mainly attributable to the market success of QQ game platform and Shanda BnB. iResearch forecasts that market size of China online casual game industry will keep fast growth in the following years: its is estimated that market size of China online casual game will reach RMB 1.78 billion in 2007. The literature review failed to reveal any concrete consumer research done in the field of Casual gaming in India. Apart from references in articles in business and technology magazines, only two proper journal articles were found on the subject. No survey, scholarly article, book, dissertation etc on this topic covering the consumer angle and pertaining to India was found. Being a new research area, this is not surprising, but only logical. Hence we find a huge research gap here, particularly in the Indian context. RESEARCH OBJECTIVES FRAMEWORK We see that there is a wide research gap in this area. At best surveys, statistics and reports are available on the subject. While the consumers have been studied in the west and Asian markets like China, an Indian study to understand the consumer was not found on an extensive search. Therefore, in the proposed research we plan to- Understand the Indian college-going casual internet gamer No research was found on the above mentioned research field, inspite of extensive search. An exploratory research in this field is hence in order. The phenomena of Internet gaming and hence out study will be largely restricted to SEC A and SEC B in India ( JuxtConsult study,2009 ). This is due to the current limitations of internet penetration. Though a comprehensive study needs to be done on all existing and potential casual gamers, the proposed dissertation will be limited to college going gamers only. This will be so keeping in mind the time constraints of the dissertation. The research objectives: Find out reasons why college-goers play casual internet games What are usage patterns of casual internet-gaming in India Explore the casual gaming phenomena First we need to know the platforms where casual internet games are being played by college-goers. After that we will find the reasons why these gamers are hooked on to casual internet gaming. We will then find the relations between the usage pattern and the reasons of usage and explore this area of casual gaming from the consumer perspective. This will give us various hypothesis which then can be verified. Hence it will help develop a consumer-centric approach which is currently missing in the industry. A deep understanding of the casual internet gamers in India is necessary for this approach. The researchs objective is to develop this new approach for the industry and academia alike within the constraints of a research (college-going students only). PROPOSED RESEARCH DESIGN AND METHODOLOGY To find out the whys and hows of the Indian Casual gaming industry, a qualitative research will be in place. Here we are trying to understand the usage and behavior of the college going audience with respect to casual gaming, which requires a qualitative approach. Secondary research- Being an area which appears to be hardly studied, the starting point would be studies done on gaming in India, for example à ¢Ã¢â€š ¬Ã¢â‚¬Å" IAMAI-IMRB report NASSCOM Animation Gaming Report IGDA reports These reports give an insight on the demographics of the Indian gamer and are a good place to start. A secondary research on the subject of Casual online gaming will tell us where to find the gamers and challenges of the Industry. It will basically give an industry point of view. With the help of these reports and an extensive online research, we will be able to find out the platforms where the gamers are playing casual games, for example- Dedicated Casual gaming websites Social media networks Mobiles Film/brand promotion websites A comprehensive list of all the casual gaming platforms on the internet will be made. Once we know where to find the college going casual gamer, we can move on to the next stage, which is to probe him/her. Apart from this, casual gaming phenomena in other countries will be studied where research has already been done on the subject. Quantitative studies on Indian gaming industry will be studied to form a strong base for the qualitative research to be undertaken. Primary research- We will through the secondary research know where to find the Indian casual gamer. We will then do a primary research to find the reasons why people play casual games. In- depth Interviews- To find out the reasons why people play casual internet games 15 in-depth interviews will be conducted keeping in mind that all possible platforms are covered. The hows and whys of the college going gamers will be found out. Questionnaire- To understand the usage patterns of the casual internet gamers, a qualitative questionnaire will be in order. It will give us the various attitudes of the gamers along with consumption patterns of the college-going gamers. We will be able to find out which games they are playing, when they are playing and how they are playing. A questionnaire will have a sample size of around 40 people from the college-going gamers. The results of the in-depth interview and questionnaire along with the secondary research will then be used to develop the psychographic profiling of the casual internet gamer. This will be done using the TGI software tool. The universe will be derived by the intensive secondary research. Sample size is proposed to be 15 in-depth interviews and 40 gamers (20 men and 20 women) for the questionnaire, keeping in mind our target, the college going gamers. Mere numbers are irrelevant here as our focus is on developing a deep understanding on the subject. As this is a qualitative study, a probability sampling method is ineffective and expensive; hence we will do non-probability sampling with convenience, quota and snow-ball sampling techniques. A content analysis technique will be undertaken. The analysis will be with a systematic description of behavior asking who, what, where, where and how questions within formulated systematic rules to limit the effects of analyst bias. Being an exploratory research, this will be a good basis to begin with. EXPECTED CONTRIBUTION The Indian gaming industry is estimated to grow at a CAGR of 49% to reach USD 830 million by 2012 which was USD 167 million in 2008. Casual internet gaming is an area of the industry which is popular and growing. And it is also an area where on an extensive search no concrete research could be found. Hence this area of research appeals to both the industry and academia. No consumer centric approach in this field has yet been observed. This research will perhaps be the first of its kind where the psychographic profiling of the college going casual internet gamers will be done and basic STP constructs on the same will be developed. For the industry, this approach will help them develop and deliver better products and being an exploratory research, for the academia the research output will provide further scope for researching in the field. This research only focuses on College going gamers. There are a lot of other segments which can be studied. Also, casual gaming is just a subset of computer gaming, which in itself is a large field to research on, given the dearth of studies done in the Indian context, leaving scope for further researches, using this research as a basis. Casual Internet Gamers in India Casual Internet Gamers in India Casual Internet Gaming in India is the area of dissertation which will be researched. A phenomenon relatively new to the world, casual internet gaming is an area which is yet to be researched and fully understood. Computer gaming is an area close to my heart, as well as an exciting and challenging field to work on, where the markets are still evolving and promising great potential in the near future. Electronic gaming itself is a very wide subject which hasnt been properly researched, especially in India. Internet gaming is a subset to it, but again an area so vast that it cant be covered in one research. Going down further, I chose casual internet gaming because of the following reasons- Casual gaming is by far the most popular mode of gaming on internet in India. Internet speeds in India allows only casual gaming to grow currently. Social media is proving to be an ideal platform for their growth No research on this topic has been done so far. We are yet to understand why people and Indians in particular are attracted towards casual gaming. Till now, Indian Marketers have not taken a consumer-centric approach to make and deliver casual games. There is great scope in the field, as Indians discover casual gaming and get hooked on to it through various platforms According to a recent study by JuxtConsult , Of the 47 million Internet users, 39 million are based in urban areas, while only 8 million reside in the rural. Hence Internet penetration is largely limited in India and speeds are still slow. In such a scenario, the only games that can work well are casual games because they dont need high end computer/gaming systems, nor are the speed requirements a constraint. In fact, being the only mode of gaming which is viable, it has been the focus of the gaming industry as well. From dedicated websites like zapak to integration of casual games to social media networks like facebook, casual games are available across the internet. The surprising part is that no one has really tried to understand the reason for their popularity or the potential profitability of these games. The growth of Indias casual games market comes in line with the overall growth of the countrys games market and industry. According to founder of CasualGaming.biz, Gaurav Mirchandani the industry has changed substantially over the past few due to the growth of internet users in India whom now have broadband access in their homes, at work, and in restaurants and hotels. This change has sparked a new emergence of casual gaming in India as a leisure and as lead to new small companies setting up offices for game development outsourcing mostly for flash and PC downloadable games. The Industry focus has been on delivering casual games across platforms to the maximum possible user base. However, no thought has been given to the consumer and their needs. The Industry lacks a consumer-centric focus in game development and delivery. A deeper understanding of why these games are being played, and by whom they are being played is necessary to improve the standards and profitability of casual gaming as a business. As the world moves towards the virtual avenues provided by the technological revolution, internet gaming assumes significance as the next major frontier of the world. Brands are already investing in this area and can really cash on into this profitable business. Internet now provides people the choice of playing with other individuals over the cyber space. The constant advances in technology open up new possibilities regularly, taking computer gaming to new heights each time. Hence, the objective of the research will be to understand the psyche of the Indian casual gamer. This will help the Indian gaming industry understand the consumers better and hence deliver better products to them. Not only that, it will also help them improve the profitability of the business, by understanding what is relevant to the gamers, and what is not. This will be an exploratory study into the realm of casual gaming in India. Given the time constraints of a dissertation, I will be able to focus on limited aspects of casual gaming. Hence I am choosing only those aspects of the area, like why do gamers behave as they do and where and when they play games, which are important both for the Industry and the academia. Again due to the time constraints and vastness of the topic, everything cannot be covered in one research. Hence a study on the college-going gamers will be conducted. LITERATURE REVIEW Very little literature is available on consumers of Casual Gaming in India. I studied the gaming industry in general to find references to casual and internet gaming, especially in the Indian context. Gaming: India is All Set! -Rao, K. Rajesh (rajesh, 2008) Prospects for Animation Gaming Industry in India. -Kuruvila, A. O. (A.O, 2008) (Computer gaming on the go in India, 2004) India: The Final Frontier for Games? (Silicon india, 2008) Zapak Taking Casual Games seriously! (Vimali, 2008) Casual Gaming A Big Draw for VCs. (Khanna, 2008) Games people play (Marketing Management, 2007) Casual video gaming is now serious business (2007) Casual Computer Games Go Upscale (2007) Nothing casual about it Rajiv Fernando 2009 The article presents the authors views concerning the development of the gaming industry in India. He relates that the new generation is characterized by the evolution of interactive digital content and distributed model of games services. The author perceives good opportunities for game developers and providers associated with the increase of Internet penetration and digital content. The article starts off with a preface of the Global and Indian gaming and animation industry and goes on to dwell upon the statistics of the industry in India. It then follows up with a SWOT analysis of the Indian gaming Industry Reports on the report released by British Broadcasting Corp. in 2005 regarding the mobile gaming market segment in India. Increase in the number of mobile phone users in October 2004; Factors that influenced the growth in the mobile gaming sector; Number of game developers and mobile companies that provide games to their subscribers. The article provides an overview of the computer games industry worldwide, particularly in India. It explains the technology trends that might influence the advent of these games including powerful cellular telephones, cloud gaming and the growth of broadband networks. A historical background on the emergence of these electronic games is also presented. The article discusses the success of the online games introduced by Zapak Digital Entertainment in India. Zapak is influential to the success of the gaming industry through the launching of massive multiplayer online games (MMOGs), hardcore games and large format gaming cafÃÆ' ©es. The companys strategies in creating value chain for its customers and distribution network are mentioned. The article presents the views of the author on various issues related to the electronic games industry in India. It focuses on the casual gaming business. The author addresses the problems on piracy and financing animation and gaming projects in the country. Future opportunities for the casual gaming space are also cited. The article discusses conflicting studies concerning the target audience for casual games. A study by Information Solutions Group found that casual gamers are predominately female. In-game advertisement firm Eyeblaster backed this data up, claiming that the majority of casual gamers are females that are more than thirty years old. However, a study by Ipsos Insight showed that more than half of computer and video gamers are male, data that is backed up by a Universal McCann study about console gamers. The article reports on the growing competition among firms in the video games industry in New York City. According to IDC Research, revenues from casual video games are expected to increase by 68 percent to $750 million in 2007 and are forecasted to reach $2 million by 2009. Wade Tinney, co-founder of Large Animal Games, said that it is important for firms in the industry to be well-funded so that they can move quickly and make products that compete with those with other companies. The article talks about the demographics of casual gamers worldwide according to the various studies that have been conducted. It also talks about the distribution of these games and what the game developers are doing to fight off competition in the casual gaming segment. It takes the zapak example to show that casual games are here to stay. It further tells about the future plans of zapak and compares the groeth of casual gaming in India with increase in internet penetration.It re-iterates that industry observers believe that online games had great potential for growth in the Indian gaming market, as it overcame the problem of piracy. Sify eyes kids for gaming biz (2007, Infotech.indiatimes.com) Web 2.0: Online Communities, Personalization and the Web OS. (Singh, 2006) Casual Games White Paper -IGDA ,2003 The 2009-2014 Outlook for PC Casual Games in India Icon Group International, Inc. 2008 Insights on Casual Games, Nielson, 2009 Casual gaming study conducted by NPD Group China Gaming 2008à ¢Ã¢â€š ¬Ã¢â‚¬Å"2012 Forecast and Analysis Casual Gaming Market Update James Kuai and Peter Shackelfor 3Q 2007 2004 China Casual Game Research Report (2005) It shows the interest of the industry in the casual gaming industry and an attempt to focus on the needs of the consumers, finally. I talks about Sify and its plan to acquire casual games and make them available all across Sifys cyber cafes. The article reports developments on Web 2.0 in India. Social networks and casual gaming continue to prevail in the major themes of Web 2.0. Online communities emphasize the notion of more sharing and connectivity on the Internet, as well as a strong focus on personalization. Another interesting phenomenon in the Web 2.0 world is the emerging space of online casual gaming. This article is on the International Casual Games industry. Numerous players continue to enter the market, business models are constantly changing, and new customers are found every day. This paper helps define the industry, and give everyone a base level of understanding of all aspects of this space. It is not intended to go into minute detail on any one subject, but provides broad understanding to the major factors involved in the casual game industry. This econometric study covers the latent demand outlook for PC casual games across the states, union territories and cities of India. Latent demand (in millions of U.S. dollars), or potential industry earnings (P.I.E.) estimates are given across over 5,000 cities in India. This report does not discuss the specific players in the market serving the latent demand, nor specific details at the product level. Nor does the report cover actual sales data (which are simply unavailable, in a comparable or consistent manner in virtually all of the cities in India) This study looks at data from more than 800 casual games for PC computers, which are defined as inexpensive to produce, straightforward in concept, easy to learn and simple to play. They say that casual gamers return more often to games and therefore play more often than hardcore gamers. The study, which surveyed nearly 3,000 U.S. gamers, identified 14 specific types of gamer within 39 different game genres. Casual gamers were divided into 10 classifications. The study also offered data that would seem to dispel the myth that casual gamers dont invest as much time playing games as core gamers do. This IDC study examines the dynamics of the China gaming market and focuses on online gaming. It looks at market drivers, dynamics, and strategies; the competitive landscape; and includes profiles of the top 10 vendors as well as a 2008à ¢Ã¢â€š ¬Ã¢â‚¬Å"2012 forecast. The concentration of the China online gaming market improved significantly in 2007. The revenue sum of the top 10 vendors occupied 91.8% of the total market. Casual Gaming Market Update provides in-depth analysis of the current dynamics and future directions of the rapidly growing casual gaming industry in the USA, including quantitative forecasts, competitive analysis, consumer perspectives, and profiles of leading companies in the casual gaming value chain. According to iResearch, market size of China online casual game industry was RMB 25 million in 2003 and it reaches to RMB 410 million in 2004 with growth rate of 356%. The fast growth of online casual game industry is mainly attributable to the market success of QQ game platform and Shanda BnB. iResearch forecasts that market size of China online casual game industry will keep fast growth in the following years: its is estimated that market size of China online casual game will reach RMB 1.78 billion in 2007. The literature review failed to reveal any concrete consumer research done in the field of Casual gaming in India. Apart from references in articles in business and technology magazines, only two proper journal articles were found on the subject. No survey, scholarly article, book, dissertation etc on this topic covering the consumer angle and pertaining to India was found. Being a new research area, this is not surprising, but only logical. Hence we find a huge research gap here, particularly in the Indian context. RESEARCH OBJECTIVES FRAMEWORK We see that there is a wide research gap in this area. At best surveys, statistics and reports are available on the subject. While the consumers have been studied in the west and Asian markets like China, an Indian study to understand the consumer was not found on an extensive search. Therefore, in the proposed research we plan to- Understand the Indian college-going casual internet gamer No research was found on the above mentioned research field, inspite of extensive search. An exploratory research in this field is hence in order. The phenomena of Internet gaming and hence out study will be largely restricted to SEC A and SEC B in India ( JuxtConsult study,2009 ). This is due to the current limitations of internet penetration. Though a comprehensive study needs to be done on all existing and potential casual gamers, the proposed dissertation will be limited to college going gamers only. This will be so keeping in mind the time constraints of the dissertation. The research objectives: Find out reasons why college-goers play casual internet games What are usage patterns of casual internet-gaming in India Explore the casual gaming phenomena First we need to know the platforms where casual internet games are being played by college-goers. After that we will find the reasons why these gamers are hooked on to casual internet gaming. We will then find the relations between the usage pattern and the reasons of usage and explore this area of casual gaming from the consumer perspective. This will give us various hypothesis which then can be verified. Hence it will help develop a consumer-centric approach which is currently missing in the industry. A deep understanding of the casual internet gamers in India is necessary for this approach. The researchs objective is to develop this new approach for the industry and academia alike within the constraints of a research (college-going students only). PROPOSED RESEARCH DESIGN AND METHODOLOGY To find out the whys and hows of the Indian Casual gaming industry, a qualitative research will be in place. Here we are trying to understand the usage and behavior of the college going audience with respect to casual gaming, which requires a qualitative approach. Secondary research- Being an area which appears to be hardly studied, the starting point would be studies done on gaming in India, for example à ¢Ã¢â€š ¬Ã¢â‚¬Å" IAMAI-IMRB report NASSCOM Animation Gaming Report IGDA reports These reports give an insight on the demographics of the Indian gamer and are a good place to start. A secondary research on the subject of Casual online gaming will tell us where to find the gamers and challenges of the Industry. It will basically give an industry point of view. With the help of these reports and an extensive online research, we will be able to find out the platforms where the gamers are playing casual games, for example- Dedicated Casual gaming websites Social media networks Mobiles Film/brand promotion websites A comprehensive list of all the casual gaming platforms on the internet will be made. Once we know where to find the college going casual gamer, we can move on to the next stage, which is to probe him/her. Apart from this, casual gaming phenomena in other countries will be studied where research has already been done on the subject. Quantitative studies on Indian gaming industry will be studied to form a strong base for the qualitative research to be undertaken. Primary research- We will through the secondary research know where to find the Indian casual gamer. We will then do a primary research to find the reasons why people play casual games. In- depth Interviews- To find out the reasons why people play casual internet games 15 in-depth interviews will be conducted keeping in mind that all possible platforms are covered. The hows and whys of the college going gamers will be found out. Questionnaire- To understand the usage patterns of the casual internet gamers, a qualitative questionnaire will be in order. It will give us the various attitudes of the gamers along with consumption patterns of the college-going gamers. We will be able to find out which games they are playing, when they are playing and how they are playing. A questionnaire will have a sample size of around 40 people from the college-going gamers. The results of the in-depth interview and questionnaire along with the secondary research will then be used to develop the psychographic profiling of the casual internet gamer. This will be done using the TGI software tool. The universe will be derived by the intensive secondary research. Sample size is proposed to be 15 in-depth interviews and 40 gamers (20 men and 20 women) for the questionnaire, keeping in mind our target, the college going gamers. Mere numbers are irrelevant here as our focus is on developing a deep understanding on the subject. As this is a qualitative study, a probability sampling method is ineffective and expensive; hence we will do non-probability sampling with convenience, quota and snow-ball sampling techniques. A content analysis technique will be undertaken. The analysis will be with a systematic description of behavior asking who, what, where, where and how questions within formulated systematic rules to limit the effects of analyst bias. Being an exploratory research, this will be a good basis to begin with. EXPECTED CONTRIBUTION The Indian gaming industry is estimated to grow at a CAGR of 49% to reach USD 830 million by 2012 which was USD 167 million in 2008. Casual internet gaming is an area of the industry which is popular and growing. And it is also an area where on an extensive search no concrete research could be found. Hence this area of research appeals to both the industry and academia. No consumer centric approach in this field has yet been observed. This research will perhaps be the first of its kind where the psychographic profiling of the college going casual internet gamers will be done and basic STP constructs on the same will be developed. For the industry, this approach will help them develop and deliver better products and being an exploratory research, for the academia the research output will provide further scope for researching in the field. This research only focuses on College going gamers. There are a lot of other segments which can be studied. Also, casual gaming is just a subset of computer gaming, which in itself is a large field to research on, given the dearth of studies done in the Indian context, leaving scope for further researches, using this research as a basis.

Grace OMalley :: Biography

Her Father was a main influence in her life. She is an infamous Irish rebel. She cut her hair short like a boy as a child because she thought it would show her parents that could survive the tough life at sea. Who was this wild Irish woman? Grace O’Malley, Queen of the Irish seas. Wild and dangerous, Grace O’Malley sailed the rocky Irish coast. Born in the year 1530, legend says, when her parents looked into her eyes they said they saw the light of the sea in her eye (McCully, 2). Grace’s Father was a pirate and Chieftain of the O’Malley Clan. Owen, her father, was away for many long trips. Grace thought being a pirate was fun. She asked her parents if she could tag along with Owen. Her parents found this quite funny. Frustrated, she ran off and came back with boy hair. Eventually, Grace proved to her parents that she could withstand the journey (Stanely, PAR 1). After Grace’s first voyage her parents had to face it, she was a pirate at heart. On her first trip her parents were glade she came. Reason being, she saved her father’s life. When the O’Malley Clan was heading back they were attacked. Her father made Grace hid if they were attacked. Grace, a young fearless child, didn’t do that. Instead, she watched from above. Grace, watching the attack from above, saw someone sneak behind her father. She leaped down and attacked him, saving her father (â€Å"Pirate King†, PAR3). O’Malley was a well educated person even though she was a pirate. She could read, write and speak a few different languages including Latin. This skill helped her get places and actually helped her gain respect (McCulley PAR 2). Grace was off and married at the age of 15. Not for love but for alliance. She married Donal O’Flahrety, leader of another powerful clan like the O’Malleys. Together they fought the English and other clans for one year. At the end of the year Grace released Donal. They both couldn’t bear to let each other go. Donal and Grace stayed together not for alliance, but for love this time (â€Å"Sea Queens† 31). Later he died, when is unknown. After the death of Donal she married Richard Bourke. Richard, like Donal was the leader of a powerful clan. Together they were extremely powerful. Grace mainly married Richard for more power over the West Coast of Ireland.

Chapter 16 Investments

CHAPTER 15 INVESTMENTS CONTENT ANALYSIS OF EXERCISES AND PROBLEMS Time Range (minutes) 10-15 10-15 10-15 15-20 15-20 10-15 Number E15-1 E15-2 E15-3 E15-4 E15-5 E15-6 Content Trading Securities. (Easy) Journal entries. Unrealized holding gain. Balance sheet disclosure. Trading Securities. (Moderate) Journal entries. Income statement and balance sheet disclosures. Long-Term Investments. (Easy) Securities available for sale. Purchase and adjusting entries. Available-for-Sale Securities. (Easy) Journal entries. Compute unrealized increase/decrease balance. Available-for-Sale Securities. (Easy) Journal entries.Balance sheet disclosure. Held-to-Maturity Bond Investment. (Easy) Premium, straight-line amortization, journal entries. Error in recording interest at acquisition. Held-to-Maturity Bond Investment. (Easy) Discount, semiannual interest receipts, straight-line and effective interest methods of amortization, journal entries. Held-to-Maturity Bond Investment. (Moderate) Discount, semia nnual interest receipts, sale at gain. Effective interest method. Journal entries. Bond Investment. (Moderate) Discount, semiannual interest receipts, amortization schedule using effective interest method, journal entries.Bond Investment. (Moderate) Premium, semiannual interest receipts, amortization schedule using effective interest method, journal entries. Bond Investment. (Moderate) Premium, semiannual interest receipts, sale at loss. Effective interest method. Journal entries. Transfer Between Categories. (Easy) Reclassification from â€Å"held-to-maturity† to â€Å"available-for-sale securities. † Journal entries for interest and reclassification. E15-7 10-20 E15-8 10-20 E15-9 10-20 E15-10 10-20 E15-11 E15-12 15-20 10-15 15-1 Number E15-13 E15-14 E15-15 E15-16 E15-17 E15-18 E15-19 E15-20Content Impairment of Investment in Bonds. (Moderate) Journal entries for impairment. IFRS differences. Equity Method. (Easy) Stock investment. No goodwill. Journal entries, balanc e sheet presentation. Equity Method. (Easy) Stock investment. Journal entries. Income and depreciation. Dividends received. Equity Method. (Moderate) Stock investment. Earned income, received dividends. Journal entries. Convertible Bonds. (Easy) Purchase and conversion. Journal entries (including memorandum entry). Stock Dividends. (Easy) Journal entries for stock acquisition, stock dividend, and sale of a 1% interest.Life Insurance Policies. (Easy) Journal entries to record purchase, premium payments, change in cash surrender value. Sinking Fund. (Moderate) Purchased securities, collected dividends and interest, wrote up to fair value, sold securities, paid expenses, retired bond. Journal entries. (Appendix). Derivatives. (Moderate) Loan and derivative (interest rate swap: fair value hedge). Journal entries, including present value calculations. Financial statement disclosures (one year). Trading Securities. (Moderate) Journal entries. Income statement and balance sheet disclosures .Trading Securities. (Moderate) Journal entries. Income statement and balance sheet disclosures. Available-for-Sale Securities. (Moderate) Journal entries. Income statement and balance sheet disclosures (current and noncurrent). Effect of including unrealized holding gains and losses in income. Available-for-Sale Securities. (Moderate) Journal entries. Income statement and balance sheet (current and noncurrent) disclosures for two quarters. Temporary Available-for-Sale Investments. (Challenging) Journal entries. Income statement and balance sheet disclosures for four quarters.Investment in Available-for-Sale Bonds. (Challenging) Purchase at discount and at premium. Effective interest method of amortization. Sale. Journal entries. Income statement and balance sheet disclosures. Time Range (minutes) 15-25 10-20 10-15 10-20 15-20 5-15 10-15 10-15 E15-21 15-25 P15-1 P15-2 P15-3 15-20 15-20 20-30 P15-4 25-35 P15-5 30-45 P15-6 40-60 15-2 Number P15-7 Content Investments in Available-for-S ale Bonds and Equity Securities. (Challenging) Fair value method. Record various transactions. Income/loss determination. Determine carrying value of Temporary Investment account.Temporary Investments, Funds, Bank Reconciliation. (Challenging) Marketable securities and petty cash fund. Journal entries. Bank reconciliation. Bond Investment. (Challenging) Effective interest method. Premium. Journal entries to record purchase, interest receipt, partial sale, retirement. Bond Investment. (Challenging) Discount. Straight-line method, effective interest method. Amortization schedules. Journal entries. Bond Investment. (Moderate) Between interest dates. Discount. Straight-line method. Journal entries to record purchase, interest, retirement.Error in recording interest at acquisition. Bond Investment. (Challenging) Premium. Straight-line method, effective interest method. Amortization schedules. Journal entries. Bond Investment. (Challenging) Discount. Effective interest method. Partial sal e. Journal entries. Comparison of Fair Value and Equity Methods. (Challenging) Stock investments. Journal entries to record purchase, income, dividends, sale. Equity Method. (Challenging) Stock investments. Journal entries to record purchase, income, dividends. Equity Method. (Challenging) Stock investments. Journal entries.Goodwill computation. Year-end balance in investment account. Cash flow from operating activities under the indirect method. Equity Method. (Moderate) Stock investments. Journal entries to record purchase, income, dividends, sale. Change from Fair Value to Equity Method. (Challenging) Change from 10% to 40% ownership. Calculate dividend revenue, unrealized increase, investment income, and carrying value of investment for two years. Life Insurance Policies. (Moderate) Journal entries to record annual premiums, change in cash surrender value, policy redemption.Time Range (minutes) 30-45 P15-8 30-45 P15-9 30-45 P15-10 30-45 P15-11 20-30 P15-12 30-45 P15-13 P15-14 30 -40 30-45 P15-15 P15-16 20-30 30-40 P15-17 P15-18 30-40 25-40 P15-19 20-30 15-3 Number P15-20 Content (Appendix). Derivatives. (Moderate) Loan and derivative (interest rate swap: fair value hedge). Journal entries, including present value computations. Financial statement disclosures (two years). Time Range (minutes) 20-45 ANSWERS TO QUESTIONS Q15-1 Companies purchase securities of other corporations for a number of different reasons.One reason is to obtain additional income by investing excess cash. A second reason is to create long-term relationships with suppliers. A third reason is to obtain significant influence or control over related companies. The three categories of investments in debt and equity securities when there is no significant influence are trading securities, available-for-sale securities, and held-tomaturity debt securities. (a) A debt security represents a creditor relationship with another company. (b) An equity security represents an ownership interest in anot her company. c) The fair value is the amount at which a security could be exchanged in a current transaction between willing parties. Q15-4 When an investor owns between 20% and 50% of the voting common stock of the investee, the investor is presumed to have significant influence over the investee. When this occurs, the equity method is used to account for the investments. When the investor controls the investee by owning more than 50% of the voting common stock of the investee, then the investor issues consolidated financial statements which are the combined financial statements of both companies.Q15-5 To account for an investment in trading securities, the investment is initially recorded at cost. It is subsequently reported at fair value and the unrealized holding gains and losses are included in income. Any interest and dividend revenue, as well as realized gains and losses on sales, are likewise included in income. To account for an investment in available-for-sale securities, the investment is initially recorded at cost. It is subsequently reported at fair value, and the total unrealized holding gains and losses are reported as a component of accumulated other comprehensive income in stockholders' equity.The unrealized holding gains and losses for the period are reported in other comprehensive income. Interest and dividend revenue, as well as realized gains and losses on sales, are included in income. To account for an investment in held-to-maturity debt securities, the investment is initially recorded at cost and subsequently reported at amortized cost. Any unrealized holding gains and losses are not recorded, and interest revenue and gains and losses on sales are all included in income. 15-4 Q15-2 Q15-3 Q15-6 Q15-7 Q15-8An investment in available-for-sale securities is reported at fair value, as determined by the year-end selling prices on a securities exchange, and any changes in unrealized holding gains and losses are included in other comprehensive income. An adjusting entry is made at the end of each period to an Unrealized Increase/Decrease account and an Allowance account to reflect any change in fair value. The total unrealized increase/decrease is reported as accumulated other comprehensive income in stockholders' equity. Gains and losses on sales of securities are reported in the income statement.They are measured as the difference between the selling price and the cost (in the case of an equity security) or the amortized cost (in the case of a debt security). In addition, because the security is no longer in the portfolio of available-for-sale securities, the cumulative balance in the allowance account and the cumulative unrealized increase/decrease in the value of the security reported for that security at the previous balance sheet date must be â€Å"reversed† out of the accounts. Bonds carrying a stated interest rate above the prevailing yield for securities with a similar amount of risk are purchased at a pre mium.Premium amortizations result in an effective interest rate that is lower than the stated rate. Thus, interest revenue is lower. Bonds carrying a stated interest rate below the prevailing market rate for securities with a similar amount of risk are purchased at a discount. Discount amortizations result in an effective interest rate that is higher than the stated rate. Thus, interest revenue is higher. The two methods available to recognize interest revenue and account for premiums and discounts on investments in held-to-maturity bonds are the straight-line and effective interest methods.Under the straight-line method, an equal amount of premium or discount is amortized each period as an adjustment of interest revenue. Under the effective interest method, the market (yield) rate at the time of issuance is multiplied times the previous carrying value to determine the interest revenue. (a) When an investment in a debt security is transferred from the â€Å"held to maturity† category to the â€Å"available for sale† category, an unrealized holding gain or loss is computed by comparing the current fair value to the carrying value (amortized cost) of the bond and is reported as a component of other comprehensive income. b) When an investment in a debt security is transferred from the â€Å"available for sale† category to the â€Å"held for maturity† category, any unrealized holding gain or loss on the date of transfer continues to be reported as a component of other comprehensive income. The amount is amortized over the remaining life as an adjustment of the yield. Q15-9 Q15-10 Q15-11 Q15-12 Q15-13 Q15-14 Current asset Temporary investment (at cost) Plus: Allowance for change in value of investment Temporary investment (at market value) $XXXX XXX $XXXX 15-5 Q15-15 IFRS allow the reversal of an impairment loss.The reversal of this impairment loss is reported on the income statement. U. S. GAAP does not permit the reversal of an impairm ent loss. When an investor corporation owns a sufficiently large percentage of common stock, it is able to exert significant influence over the operating and financial policies of the investee corporation. In particular, the investor may be able to influence the investee's dividend policy. The dividends paid may be affected by the investor's cash needs, desire to raise its income, or by tax considerations. The equity method is used to account for this investment.It acknowledges the existence of a material economic relationship between the investor and the investee, is based upon the requirements of accrual accounting, and reflects the changes in the stockholders' equity of the investee company. When the equity method is used, an investment in common stock is initially recorded at its acquisition cost. However, in contrast to the fair value method, income is recorded by the investor as an increase to the Investment account and as investment income (based on the investor's percentage ownership) when it is reported by the investee.Dividends received (or receivable) are recorded as reductions in the carrying value of the Investment account whenever they are paid (or declared) by the investee. Furthermore, (1) since a material relationship is presumed, the effects of all intercompany items of revenue and expense are removed from the investor's accounts to avoid â€Å"double-counting,† and (2) if the acquisition cost is greater than the proportionate book value of the investee, additional depreciation may be recognized.It is necessary to eliminate intercompany revenues and expenses in the determination of investor net income, depreciate the proportionate share of any difference between the fair values and book values of investee depreciable assets implied by the acquisition of the investee shares, and treat the proportionate share of investee extraordinary items as investor extraordinary items (the proportionate share of investee results of discontinued opera tions is treated in a similar manner). The facts and ircumstances that preclude an investor who owns more than a 20% investment of an investee from using the equity method include: (1) the investee challenges the investor's ability to exercise significant influence through litigation or complaints to governmental regulatory authorities; (2) the investor and investee sign an agreement that the investor surrenders significant rights as a shareholder; (3) a small group of shareholders who operate the investee hold majority ownership and ignore the views of the investor; (4) the investor needs more financial information to apply the equity method than is available to the investee's other shareholders, and cannot obtain this information; (5) the investor cannot obtain representation on the investee's board of directors. a) When an investor acquires enough additional common stock during a year to change from the fair value method to the equity method, the investor is required to restate i ts investment in the investee by debiting the Investment account and crediting Retained Earnings for its previous percentage of investee earnings (less dividends) for the period from the original date of acquisition to the date that significant influence was obtained. It also eliminates any adjustments of the Allowance and Unrealized Increase/Decrease accounts made under the fair value method. Q15-16 Q15-17 Q15-18 Q15-19 15-6 Q15-19 (continued) (b) When an investor using the equity method sells a portion of the investment such that its portion of ownership falls below 20%, the use of the equity method is no longer appropriate and the investor no longer accrues its share of investee earnings. However, previously recorded income remains as a part of the carrying value of the Investment account. The investment is then accounted for under the fair value method.Q15-20 Under IFRS, Morgan and Parker could account for the joint venture arrangement using either the equity method or proportio nate consolidation. Under the equity method, Morgan and Parker would report their investment in the associate (equity method investee) at cost, adjusted for their proportionate share of the income less their proportionate share of any dividends paid by the investee. Under proportionate consolidation, Morgan and Parker would report consolidated financial statements for their proportionate share of the joint venture. (Consolidations are covered in a later accounting course. ) Under U. S. GAAP, the use of proportionate consolidation for joint venture arrangements is not allowed.Many insurance policies allow a portion of accumulated premiums to build up as a savings plan; and, if the policy is canceled, this savings plan, or cash surrender value of the policy, is returned to the company purchasing the life insurance policy. When a company is guaranteed a return equal to the amount of the cash surrender value of the policy, a part of each premium paid represents an investment. The portio n of the yearly premium that does not increase the cash surrender value of the policy is recorded as the amount of insurance expense, typically in the year-end adjustment of prepaid insurance. The amount of cash surrender value of life insurance policies is included as a long-term investment on the balance sheet. The increase each year is stated in the policy.A fund involves setting aside cash and other assets to accomplish specific objectives; whereas, an appropriation of retained earnings only reduces retained earnings available for dividends and does not provide any cash. Funds may be current, such as petty cash funds, or they may be long-term, such as those to retire long-term bonds or preferred stock, or those to purchase long-term assets. Q15-21 Q15-22 ANSWERS TO MULTIPLE CHOICE 1. 2. a b 3. 4. a c 5. 6. b b 7. 8. c a 9. 10. c c 15-7 SOLUTIONS TO REVIEW EXERCISES RE15-1 Investment in Available-For-Sale Securities* Interest Revenue ($12,000 x 0. 10 x 4/12) Cash *$12,000 + $6,00 0 RE15-2 Interest: Cash ($12,000 x 0. 0 x 6/12) Interest Revenue Dividends: Cash Dividend Revenue ($1 x 300) RE15-3 Unrealized Increase/Decrease in Value of Available-For-Sale Securities* Allowance for Change in Value of Investment *($12,300 – $12,000) + ($5,500 – $6,000) RE15-4 Cash Investment in Available-For-Sale Securities Gain on Sale of Available-For-Sale Securities Allowance for Change in Value of Investment Unrealized Increase/Decrease in Value of Available-For-Sale Securities RE15-5 Investment in Held-To-Maturity Debt Securities Cash 215,443 215,443 6,400 6,000 400 200 600 18,000 400 18,400 600 300 300 200 500 500 15-8 RE15-6 Cash ($200,000 x 0. 12 x ? ) Investment in Held-To-Maturity Debt Securities Interest Revenue ($215,443 x 0. 10 x ? RE15-7 Investment in Trading Securities Investment in Available-For-Sale Securities Gain on Transfer of Securities Unrealized Increase/Decrease in Value of Available-For-Sale Securities Allowance for Change in Value of Invest ment RE15-8 Realized Loss on Decline in Value Investment in Held-To-Maturity Debt Securities RE15-9 Investment in Stock: Eagle Corporation (0. 30 x $120,000) Investment Income Investment Income Investment in Stock: Eagle Corporation [($620,000 – $600,000) x 0. 30] ? 8 Cash (0. 30 x $48,000) Investment in Stock: Eagle Corporation RE15-10 Note: No journal entry is required, only a memorandum entry is made for a stock dividend. Memo: Received 1,500 shares of Gamecock Company stock as a stock dividend. The cost of the shares is now $22 per share, computed as follows: ($99,000 ? 4,500). 36,000 750 750 14,400 14,400 15,520 15,520 12,500 9,400 3,100 12,000 1,228 10,772 2,300 2,300 36,000 15-9RE15-11 Cash (750 x $28) Investment in Available-For-Sale Securities (750 x $22) Gain on Sale of Investment [750 x ($28 – $22)] Unrealized Increase/Decrease in Value of Available-For-Sale Securities [750 x ($24 – $22)] Allowance for Change in Value of Investment RE15-12 Prepaid Ins urance Cash Insurance Expense Cash Surrender Value of Life Insurance Prepaid Insurance 12,000 10,500 1,500 12,000 21,000 16,500 4,500 1,500 1,500 12,000 15-10 SOLUTIONS TO EXERCISES E15-1 1. 2010 Dec. 10 21 31 Investment in Trading Securities Cash (500 x $76) Investment in Trading Securities Cash (800 x $34) Investment in Trading Securities Unrealized Gain on Increase in Value of Trading Securities 38,000 27,200 700* 700 12/31/10 Fair Value $39,500 26,400 $65,900 Cumulative Change in Fair Value $1,500 (800) $ 700 38,000 27,200 *Security 500 shares of C Company common stock 800 shares of D Company common stock Totals 2. 3. E15-2 1. 2010 Oct. Nov. 26 26 Cost $38,000 27,200 $65,200 700 unrealized gain on increase in value of trading securities; reported on 2010 income statement. Current assets: Temporary investment in trading securities (at fair value) $65,900 Investment in Trading Securities Cash (300 x $35) Cash (200 x $25) Loss on Sale of Trading Securities Investment in Trading Sec urities Investment in Trading Securities Cash (400 x $41) Investment in Trading Securities Unrealized Gain on Increase in Value of Trading Securities 10,500 5,000 200 16,400 500* 10,500 5,200 16,400 Dec. 10 31 500 15-11 E15-2 (continued) 1. (continued) *Security 300 shares of F Company common stock 400 shares of G Company common stock Totals 2. 3.E15-3 2010 During the year Investment in Available-for-Sale Securities Cash (900 x $18) Investment in Available-for-Sale Securities Cash (800 x $22) Dec. 31 Unrealized Increase/Decrease in Value of Available-for-Sale Securities Allowance for Change in Value of Investment 12/31/10 Fair Value $14,000 15,300 16,000 $45,300 Cost $10,500 16,400 $26,900 12/31/10 Fair Value $11,400 16,000 $27,400 Cumulative Change in Fair Value $ 900 (400) $ 500 $ (200) 500 $27,400 Loss on sale of trading securities Unrealized gain on increase in value of trading securities Current assets: Temporary investment in trading securities (at fair value) 16,200 16,200 17 ,600 17,600 1,500 1,500* Cumulative Change in Fair Value $(1,000) (900) (1,600) $(3,500) Security X Company common stock Y Company common stock Z Company common stock Totals Cost $15,000 16,200 17,600 $48,800 $1,500 credit adjustment = $3,500 required ending credit balance – $2,000 beginning credit balance 15-12 E15-3 (continued) Noncurrent assets: Investment in available-for-sale securities (at cost) Less: Allowance for change in value of investment Investment in available-for-sale securities (at fair value) Stockholders' equity: Accumulated Other Comprehensive Income: Unrealized decrease in value of available-for-sale securities E15-4 1. 2010 May 3 Investment in Available-for-Sale Securities Cash Cash Investment in Available-for-SaleSecurities Gain on Sale of Available-for-Sale Securities ($25,000 – $20,000) Unrealized Increase/Decrease in Value of Available-for-Sale Securities ($25,000 – $20,000) Allowance for Change in Value of Investment Cash Dividend Reven ue Allowance for Change in Value of Investment Unrealized Increase/Decrease in Value of Available-for-Sale Securities $48,800 (3,500) $45,300 $ (3,500) 13,500 25,000 13,500 July 16 20,000 5,000 16 5,000 5,000 800 800 Dec. 31 31 5,000* 5,000 12/31/10 Fair Value $32,000 15,500 $47,500 Cumulative Change in Fair Value $2,000 2,000 $4,000 *Security B Company common stock C Company common stock Totals Cost $30,000 13,500 $43,500 15-13 E15-4 (continued) 1. (continued) $5,000 debit adjustment = $4,000 required ending debit balance + $5,000 credit adjustment (7/16/10) – $4,000 beginning debit balance 2. $4,000 credit balance [$4,000 beginning credit balance – $5,000 debit adjustment (7/16/10) + $5,000 ending credit adjustment] E15-5 1. 010 June 8 Investment in Available-for-Sale Securities Cash Cash Loss on Sale of Available-for-Sale Securities ($35,400 – $37,000) Investment in Available-for-Sale Securities Allowance for Change in Value of Investment Unrealized Increase/ Decrease in Value of Available-for-Sale Securities Cash Dividend Revenue Allowance for Change in Value of Investment Unrealized Increase/Decrease in Value of Available-for-Sale Securities 50,000 35,400 1,600 50,000 Oct. 11 37,000 2,800 2,800 900 900 Oct. 11 Dec. 31 31 400* 400 12/31/10 Fair Value $43,900 49,600 $93,500 Cumulative Change in Fair Value $1,900 (400) $1,500 *Security N Company common stock O Company common stock Totals Cost $42,000 50,000 $92,000 15-14 E15-5 (continued) 1. continued) $400 debit adjustment = $1,500 required ending debit balance – [$1,700 beginning credit balance – $2,800 debit adjustment (10/11/10)] $92,000 1,500 $93,500 2. Noncurrent assets: Investment in available-for-sale securities (at cost) Plus: Allowance for change in value of investment Investment in available-for-sale securities (at fair value) Stockholders' equity: Accumulated Other Comprehensive Income: Unrealized increase in value of available-for-sale securities $ 1,500 E15-6 1 . 2010 Mar. 31 Investment in Held-to-Maturity Debt Securities Interest Revenue ($400,000 x 0. 12 x 3/12) Cash Cash ($400,000 x 0. 12 x 6/12) Interest Revenue [($400,000 x 0. 2 x 6/12) – $600] Investment in Held-to-Maturity Debt Securities [($413,800 $400,000) x 3/69] Cash Interest Revenue ($24,000 – $1,200) Investment in Held-to-Maturity Debt Securities ($13,800 x 6/69) 413,800 12,000 24,000 23,400 600 24,000 22,800 1,200 425,800 June 30 Dec. 31 2. If the company failed to separately record the interest at acquisition, the interest revenue for 2010 would be overstated and the value of the held-tomaturity debt securities would also be overstated. Therefore, excess amortization would be recognized over the remaining life of the bond, resulting in an understatement of interest revenue. 15-15 E15-7 1. 2010 Jan. 1 Investment in Held-to-Maturity Debt Securities Cash Cash ($500,000 x 0. 09 x 6/12) Investment in Held-to-Maturity Debt Securities [($500,000 $483,841. 79) ? ] Int erest Revenue Cash Investment in Held-to-Maturity Debt Securities Interest Revenue Investment in Held-to-Maturity Debt Securities Cash Cash ($500,000 x 0. 09 x 6/12) Investment in Held-to-Maturity Debt Securities ($24,192. 09 – $22,500) Interest Revenue ($483,841. 79 x 0. 10 x 6/12) Cash Investment in Held-to-Maturity Debt Securities Interest Revenue [($483,841. 79 + $1,692. 09) x 0. 10 x 6/12] 483,841. 79 22,500. 00 2,019. 78 22,500. 00 2,019. 78 483,841. 79 June 30 24,519. 78 Dec. 31 24,519. 78 2. 2010 Jan. 1 483,841. 79 22,500. 00 1,692. 09 483,841. 79 June 30 24,192. 09 22,500. 00 1,776. 69 24,276. 69 Dec. 31 15-16 E15-8 2009 Nov. 1 Investment in Held-to-Maturity Debt Securities Cash 673,618. 61 673,618. 1 REID CORPORATION Bond Investment Interest Revenue and Discount Amortization Schedule (Partial) Effective Interest Method Cash Debita $35,000 35,000 x 0. 10 x ? carrying value x 0. 11 x ? from footnote b – amount from footnote a carrying value + amount from footno te c Cash Investment in Held-to-Maturity Debt Securities Interest Revenue Cash Investment in Held-to-Maturity Debt Securities Interest Revenue Cash Investment in Held-to-Maturity Debt Securities (from schedule) Gain on Sale of Debt Securities 35,000. 00 2,049. 02 35,000. 00 2,161. 72 700,000. 00 677,829. 35 22,170. 65 37,161. 72 37,049. 02 Interest Revenue Creditb $37,049. 02 37,161. 2 Investment in Debt Securities Debitc $2,049. 02 2,161. 72 Carrying Value of Debt Securitiesd $673,618. 61 675,667. 63 677,829. 35 Date 11/01/09 04/30/10 10/31/10 a$700,000 bPrevious cAmount dPrevious 2010 Apr. 30 Oct. 31 Nov. 1 15-17 E15-9 1. 2010 Jan. 1 Investment in Held-to-Maturity Debt Securities Cash 190,165. 35 190,165. 35 2. RODGERS COMPANY Bond Investment Interest Revenue and Discount Amortization Schedule Effective Interest Method Cash Debita $10,000 10,000 10,000 10,000 10,000 10,000 Interest Revenue Creditb $11,409. 92 11,494. 52 11,584. 19 11,679. 24 11,779. 99 11,886. 79 Investment in Deb t Securities Debitc $1,409. 92 1,494. 52 1,584. 19 1,679. 24 1,779. 99 1,886. 9 Carrying Value of Debt Securitiesd $190,165. 35 191,575. 27 193,069. 79 194,653. 98 196,333. 22 198,113. 21 200,000. 00 Date 01/01/10 06/30/10 12/31/10 06/30/11 12/31/11 06/30/12 12/31/12 a$200,000 bPrevious cAmount dPrevious (face value) x 0. 10 (face rate of interest) x ? (year) carrying value x 0. 12 (effective interest rate) x ? (year) from footnote b – amount from footnote a carrying value + amount from footnote c Cash Investment in Held-to-Maturity Debt Securities Interest Revenue Cash Investment in Held-to-Maturity Debt Securities Interest Revenue 10,000. 00 1,409. 92 11,409. 92 3. 2010 June 30 2012 June 30 10,000. 00 1,779. 99 11,779. 99 15-18 E15-10 1. 2010 Jan. Investment in Held-to-Maturity Debt Securities Cash LYNCH COMPANY Bond Investment Interest Revenue and Premium Amortization Schedule Effective Interest Method Cash Debita $3,250 3,250 3,250 3,250 3,250 3,250 Interest Revenue Credi tb $3,073. 76 3,063. 19 3,051. 98 3,040. 10 3,027. 50 3,014. 12e Investment in Debt Securities Creditc $176. 24 186. 81 198. 02 209. 90 222. 50 235. 88 Carrying Value of Debt Securitiesd $51,229. 35 51,053. 11 50,866. 30 50,668. 28 50,458. 38 50,235. 88 50,000. 00 51,229. 35 51,229. 35 2. Date 01/01/10 06/30/10 12/31/10 06/30/11 12/31/11 06/30/12 12/31/12 a$50,000 (face value) x 0. 13 (face rate of interest) x ? (year) carrying value x 0. 12 (effective interest rate) x ? year) from footnote a – amount from footnote b carrying value – amount from footnote c due to $0. 03 rounding error Cash Investment in Held-to-Maturity Debt Securities Interest Revenue Cash Investment in Held-to-Maturity Debt Securities Interest Revenue 3,250. 00 176. 24 3,073. 76 3,250. 00 235. 88 3,014. 12 bPrevious cAmount dPrevious eDifference 3. 2010 June 30 2012 Dec. 31 15-19 E15-11 2010 Jan. 1 Investment in Held-to-Maturity Debt Securities Cash 307,493. 34 307,493. 34 GLOVER CORPORATION Bond Inv estment Interest Revenue and Premium Amortization Schedule (Partial) Effective Interest Method Cash Debita $18,000 18,000 Interest Revenue Creditb $16,912. 13 16,852. 30 Investment in Debt Securities Creditc $1,087. 87 1,147. 0 Carrying Value of Debt Securitiesd $307,493. 34 306,405. 47 305,257. 77 Date 01/01/10 06/30/10 12/31/10 a$300,000 bPrevious cAmount dPrevious (face value) x 0. 12 x ? year carrying value x 0. 11 x ? year from footnote a – amount from footnote b carrying value – amount from footnote c Cash Interest Revenue Investment in Held-to-Maturity Debt Securities Cash Interest Revenue Investment in Held-to-Maturity Debt Securities Cash Loss on Sale of Debt Securities Investment in Held-to-Maturity Debt Securities (from schedule) 18,000 2010 June 30 16,912. 13 1,087. 87 Dec. 31 18,000 16,852. 30 1,147. 70 2011 Jan. 1 300,000. 00 5,257. 77 305,257. 77 15-20 E15-12 2010 Dec. 1 Cash ($100,000 x 0. 08) Interest Revenue ($107,023. 56 x 0. 07) Investment in Held-t o-Maturity Debt Securities ($8,000 $7,491. 65) Investment in Available-for-Sale Securities Investment in Held-to-Maturity Debt Securities ($107,023. 56 – $508. 35) Unrealized Increase/Decrease in Value of Available-for-Sale Securities Allowance for Change in Value of Investment [$106,515. 21 ($100,000 x 1. 05)] 8,000 7,491. 65 508. 35 106,515. 21 106,515. 21 31 31 1,515. 21 1,515. 21 E15-13 1. June 1, 2010 Investment in Held-to-Maturity Debt Securities Cash 2011 Realized Loss on Decline in Value Investment in Held-to-Maturity Debt Securities 2012 No entry 2.Under IFRS, the company would make the same journal entries as in Requirement 1 for 2010 and 2011. In 2012, it would recognize the recovery of the impairment as follows: 2012 Investment in Held-to-Maturity Debt Securities Realized Loss Recovery on Increase in Value 3,000 10,000 10,000 4,000 4,000 3,000 15-21 E15-14 1. 2010 Jan. 1 Investment in Stock: Crowell Corporation Cash Cash ($50,000 x 0. 30) Investment in Stock: Crow ell Corporation Investment in Stock: Crowell Corporation Investment Income ($120,000 x 0. 30) Cash ($50,000 x 0. 30) Investment in Stock: Crowell Corporation Investment in Stock: Crowell Corporation Investment Income ($140,000 x 0. 30) 160,000 15,000 160,000 Mar. 31 5,000 36,000 36,000 15,000 15,000 42,000 42,000 June 30 Sept. 30 Dec. 31 2. Investment in Stock: Crowell Corporation Original investment $160,000 Share of 06/30 investment income 36,000 Share of 12/31 investment income 42,000 Balance, 12/31/10 $208,000 03/31 dividend 09/30 dividend $15,000 15,000 E15-15 2010 Jan. Dec. 1 31 31 31 Investment in Stock: North Company Cash Investment in Stock: North Company Investment Income ($45,000 x 0. 40) Investment Income ($15,000 ? 12 years) Investment in Stock: North Company Cash ($0. 70 x 8,000) Investment in Stock: North Company 15-22 144,000 18,000 1,250 5,600 144,000 18,000 1,250 5,600 E15-16 2010 Jan.During the year 1 Investment in Stock: Fink Company Cash (3,000 x $16) Investment in Stock: Fink Company Investment Income ($22,000 x 0. 30) Cash ($6,000 x 0. 30) Investment in Stock: Fink Company 31 Investment Income Investment in Stock: Fink Company a[($115,000 48,000 6,600 1,800 750a 48,000 6,600 1,800 750 Dec. – $90,000) x 0. 30] ? 10 years E15-17 2009 Jan. 1 Investment in Available-for-Sale Securities Cash 19,760 19,760 2011 July 1 Memorandum entry: On this date, the Taylor Corporation exchanged its investment in Kalanda Corporation 12% convertible bonds with a carrying value of $19,880a for 300 shares of Kalanda common stock with a fair value of $21,600.The cost per share is $66. 27 ($19,880 ? 300 shares). a$19,760 + (5 x $24*) *Amortization per period = $24 [($20,000 – $19,760) ? 10 periods] E15-18 2010 Mar. 2 Investment in Available-for-Sale Securities Cash 60,000 60,000 May 1 Memorandum entry: Received 1,000 (5,000 x 0. 20) additional shares of Foreman Company common stock as a stock dividend. The cost of the shares is now $10 per share as follows: $60,000 = $10 5,000 + (5,000 x 0. 20) 15-23 E15-18 (continued) 2011 Feb. 1 Cash (1,500 x $12) Investment in Available-for-Sale Securities (1,500 x $10) Gain on Sale of Investment in Available-for-Sale Securities 18,000 15,000 3,000 E15-19 2010 Jan. Dec. 31 Prepaid Insurance Cash Insurance Expense Cash Surrender Value of Life Insurance ($103,900 – $98,450) Prepaid Insurance Cash Gain on Death of Officer Cash Surrender Value of Life Insurance 13,300 7,850 5,450 13,300 13,300 2011 Jan. 1 50,000 43,520 6,480 E15-20 2010 Jan. Feb. July 1 3 30 Sinking Fund Cash Cash Sinking Fund Securities Sinking Fund Cash Sinking Fund Cash Loss on Sale of Sinking Fund Securities Sinking Fund Securities Sinking Fund Cash Sinking Fund Revenues Allowance for Change in Value of Sinking Fund Securities [$355,000 – ($400,000 – $48,000)] Unrealized Increase/Decrease in Value of Sinking Fund Securities 425,000 400,000 45,000 3,000 49,000 48,000 49,000 425,000 400,000 Dec. 31 31 3, 000 3,000 15-24 E15-20 (continued) 2011 Dec. 1 31 31 Sinking Fund Cash Sinking Fund Revenues Sinking Fund Expenses Sinking Fund Cash Sinking Fund Cash Sinking Fund Securities Gain on Sale of Sinking Fund Securities 40,000 4,500 360,000 40,000 4,500 352,000 8,000 31 Unrealized Increase/Decrease in Value of Sinking Fund Securities Allowance for Change in Value of Sinking Fund Securities 31 31 E15-21 Bonds Payable Sinking Fund Cash Cash Sinking Fund Cash 3,000 3,000 500,000 14,500 500,000 14,500 Note to Instructor: This interest rate swap is a fair value hedge. Original Bank Loan (not required) Cash Notes Payable Interest Payment on Loan: December 31, 2010 Interest Expense Cash a7% 3,000,000 3,000,000 210,000a 210,000 x $3 million Interest Rate Swap Payment: December 31, 2010 Cash Interest Expense b(7% 12,000b 12,000 – 6. 6%) x $3 million 15-25E15-21 (continued) Fair Values and Gains and Losses, December 31, 2010 Loss in Value of Derivative Liability from Interest Rate Swap cPre sent 53,497c 53,497 value = (8% – 7%) x $3,000,000 x 1. 783265 (n=2, i=0. 08 from Table 4 in the TVM Module) = $30,000 x 1. 783265 = $53,497 (rounded down to balance) A swap derivative loss and liability exist because the 8% current market rate is higher than the 7% fixed interest rate that Anglar receives on the derivative. Notes Payable Gain in Value of Debt dPresent 53,497d 53,497 value of principal = $3,000,000 x 0. 857339 (n=2, i=0. 08 from Table 3 in the TVM Module) = $2,572,017 = $210,000 x 1. 783265 (n=2, i=0. 08 from Table 4 in the TVM Module) = $374,486 = $2,572,017 + $374,486 = $2,946,503Present value of interest Total present value Decrease in value of debt = $3,000,000 – $2,946,503 = $53,497 The increase in interest rates decreases the value of note payable by the same amount as the increase in the value of the swap derivative liability. 15-26 E15-21 (continued) 2. Income Statement for Year Ending December 31, 2010 Other Items: Interest expense Loss in val ue of derivative Gain in value of debt e$210,000 $ (198,000)e (53,497) 53,497 – $12,000 Balance Sheet, December 31, 2010 Long-Term Liabilities: Notes payable Liability from interest rate swap f$3,000,000 – $53,497 $2,946,503f 53,497 $3,000,000 15-27 SOLUTIONS TO PROBLEMS P15-1 1. 2010 Nov. 19 29 Investment in Trading Securities Cash (200 x $86) Investment in Trading Securities Cash (300 x $63) Cash (100 x $89) Investment in Trading Securities (100 x $86) Gain on Sale of Trading Securities Investment in Trading Securities Cash (400 x $37) Cash (100 x $62) Loss on Sale of Trading Securities Investment in Trading Securities (100 x $63) Unrealized Loss on Decrease in Value of Trading Securities Investment in Trading Securities 17,200 18,900 8,900 8,600 300 14,800 6,200 100 6,300 200 14,800 17,200 18,900 Dec. 15 17 31 200* Cumulative Change in Fair Value $ 100 (400) 100 $(200) $ 300 (100) (200) $35,800 *Security 100 shares of M Company common stock 200 shares of P Company p referred stock 400 shares of T Company common stock Totals 2. Cost $ 8,600 12,600 14,800 $36,000 12/31/10 Fair Value $ 8,700 12,200 14,900 $35,800Gain on sale of trading securities Loss on sale of trading securities Unrealized loss on decrease in value of trading securities Current assets: Temporary investment in trading securities (at fair value) 3. 15-28 P15-2 1. 2010 July 2 14 Cash (100 x $1. 50) Dividend Revenue Cash (600 x $20) Loss on Sale of Trading Securities Investment in Trading Securities Investment in Trading Securities Cash (300 x $36) Cash (100 x $30) Investment in Trading Securities Gain on Sale of Trading Securities Investment in Trading Securities Cash (500 x $22) Unrealized Loss on Decrease in Value of Trading Securities Investment in Trading Securities 150 12,000 600 10,800 3,000 150 12,600 10,800 2,800 200 11,000 Aug. 9 24 Sept. 17 30 11,000 350 350* *Security 300 shares of P Company preferred stock 500 shares of U Company common stock Totals 2.Cost $10,800 11,00 0 $21,800 Cumulative 9/30/10 Change in Fair Value Fair Value $10,950 $ 150 10,500 (500) $21,450 $(350) $ 150 (600) 200 (350) $21,450 Dividend revenue Loss on sale of trading securities Gain on sale of trading securities Unrealized loss on decrease in value of trading securities Current assets: Temporary investment in trading securities (at fair value) 3. 15-29 P15-3 1. 2010 Mar. 31 Investment in Available-for-Sale Securities Interest Revenue ($10,000 x 0. 08 x 3/12) Cash Cash (200 x $30) Loss on Sale of Available-for-Sale Securities {200 x [$30 – ($23,100 ? 700)]} Investment in Available-for-Sale Securities [200 x ($23,100 ? 00)] Allowance for Change in Value of Investment Unrealized Increase/Decrease in Value of Available-for-Sale Securities [200/700 x ($21,700 – $23,100)] Cash Interest Revenue ($10,000 x 0. 08 x 6/12) Cash (100 x $24) Investment in Available-for-Sale Securities [100 x ($8,400 ? 400)] Gain on Sale of Available-for-Sale Securities {100 x [$24 ($8,400 ? 400)]} Unrealized Increase/Decrease in Value of Available-for-Sale Securities [100/400 x ($9,400 – $8,400)] Allowance for Change in Value of Investment 10,000 200 10,200 May 17 6,000 600 6,600 400 17 400 400 400 2,400 2,100 300 June 30 Oct. 12 12 250 250 15-30 P15-3 (continued) 1. (continued) Dec. 31 Cash Interest Revenue ($10,000 x 0. 8 x 6/12) Dividend Revenue [(300 x $1) + (500 x $1. 50)] Allowance for Change in Value of Investment Unrealized Increase/Decrease in Value of Available-for-Sale Securities 1,450 400 1,050 550* 550 12/31/10 Fair Value $ 7,500 15,500 10,100 $33,100 Cumulative Change in Fair Value $1,200 (1,000) 100 $ 300 31 *Security 300 shares of I Company common stock 500 shares of O Company common stock $10,000 face value of U Company 8% bonds Totals $550 debit adjustment = Cost $ 6,300 16,500 10,000 $32,800 $300 required ending debit balance + [$400 beginning credit balance – $400 debit adjustment (5/17/10) + $250 credit adjustment (10/12/10)] $ 600 1 ,050 (600) 300 2.Interest revenue Dividend revenue Loss on sale of available-for-sale securities Gain on sale of available-for-sale securities Current assets: Temporary investment in available-for-sale securities (at cost) Plus: Allowance for change in value of investment Temporary investment in available-for-sale securities (at fair value) Noncurrent assets: Investment in available-for-sale securities (at cost) Less: Allowance for change in value of investment Investment in available-for-sale securities (at fair value) 3. $6,300 1,200 $7,500 $26,500 (900) $25,600 15-31 P15-3 (continued) 3. (continued) Stockholders' equity: Accumulated Other Comprehensive Income: Unrealized increase in value of available-for-sale securities 4. Holly would include a gain of $700 [the change in the unrealized increase/decrease on the portfolio from $(400) to $300]. $ 300 P15-4 1. 2010 Jan. Cash (400 x $45) Investment in Available-for-Sale Securities (400 x $43) Gain on Sale of Available-for-Sale Secur ities [(400 x $45) – $17,200] Unrealized Increase/Decrease in Value of Available-for-Sale Securities Allowance for Change in Value of Investment (400 x $1) Investment in Available-for-Sale Securities Cash (700 x $45) Cash Dividend Revenue Unrealized Increase/Decrease in Value of Available-for-Sale Securities Allowance for Change in Value of Investment 18,000 17,200 800 6 400 400 31,500 2,500 Feb. 3 31,500 2,500 Mar. 31 31 2,300 2,300* 15-32 P15-4 (continued) 1. (continued) 3/31/10 Fair Value $ 29,500 18,000 28,000 30,100 $105,600 Cumulative Change in Fair Value $ (500) 800 -(1,400) $ (1,100) Cost *Security 500 shares of Keene Company common stock $ 30,000 400 shares of Sachs, Inc. common stock 17,200 400 shares of Bacon Company common stock 28,000 700 shares of Jackson Corp. common stock 31,500 Totals $106,700 $2,300 credit adjustment $1,100 required ending credit balance + [$1,600a beginning debit balance – $400 credit adjustment (1/6/10)] a[800 x ($44 – $43)] + [400 x ($72 – $70)] Apr. 14 Investment in Available-for-Sale Securities Cash (300 x $52) Cash (400 x $42) Loss on Sale of Available-for-Sale Securities [(400 x $42) – $17,200] Investment in Available-for-Sale Securities Unrealized Increase/Decrease in Value of Available-for-Sale Securities Allowance for Change in Value of Investment Cash Dividend Revenue Allowance for Change in Value of Investment Unrealized Increase/Decrease in Value of Available-for-Sale Securities 15,600 16,800 400 17,200 15,600 May 11 11 800 800 2,800 2,800 June 30 30 2,600* 2,600 15-33 P15-4 (continued) 1. continued) 6/30/10 Fair Value $ 31,000 27,600 32,200 15,000 $105,800 Cumulative Change in Fair Value $ 1,000 (400) 700 (600) $ 700 Cost *Security 500 shares of Keene Company common stock $ 30,000 400 shares of Bacon Company common stock 28,000 700 shares of Jackson Corp. common stock 31,500 300 shares of Quinn Company common stock 15,600 Totals $105,100 $2,600 debit adjustment = $700 required ending debit balance + [$1,100 beginning credit balance + $800 credit adjustment (5/11/10)] $ 800 2,500 Second Quarter 2010 Loss on sale of securities $ (400) Dividend revenue 2,800 3/31/10 $47,200 300 $47,500 6/30/10 $30,000 1,000 $31,000 2. First Quarter 2010 Gain on sale of securities Dividend revenue 3.Assets Current assets: Temporary investment in available-for-sale securities (at cost) Plus: Allowance for change in value of investment Temporary investment in available-for-sale securities (at fair value) Noncurrent assets: Investment in available-for-sale securities (at cost) Less: Allowance for change in value of investment Investment in available-for-sale securities (at fair value) Stockholders' Equity Accumulated Other Comprehensive Income: Unrealized increase (decrease) in value of available-for-sale securities $59,500 (1,400) $58,100 $75,100 (300) $74,800 $ (1,100) $ 700 15-34 P15-5 1. 2010 Jan. Mar. 6 31 31 Cash Dividend Revenue Cash Dividend Revenue Allowance for Change in Value of Investment Unrealized Increase/Decrease in Value of Available-for-Sale Securities 265 500 65 500 1,180* 1,180 Cumulative 3/31/10 Change in Fair Value Fair Value $13,470 $ (805) 13,765 1,115 18,940 1,490 15,500 (3,600) $61,675 $(1,800) *Security 400 shares of Turben Co. common stock 500 shares of Cook Corp. common stock 700 shares of Hill Corp. common stock 200 shares of Web Engines preferred stock Totals $1,180 debit adjustment June 30 30 Cost $14,275 12,650 17,450 19,100 $63,475 = $1,800 required ending credit balance – $2,980 ($63,475 – $60,495) beginning credit balance 1,075 1,075 Cash ($375 + $700) Dividend Revenue Allowance for Change in Value of Investment Unrealized Increase/Decrease in Value of Available-for-Sale Securities 50* 450 6/30/10 Fair Value $13,300 14,125 19,300 15,400 $62,125 Cumulative Change in Fair Value $ (975) 1,475 1,850 (3,700) $(1,350) *Security 400 shares of Turben Co. common stock 500 shares of Cook Corp. common stock 700 shares of Hill Corp. common stock 200 shares of Web Engines preferred stock Totals Cost $14,275 12,650 17,450 19,100 $63,475 15-35 P15-5 (continued) 1. (continued) $450 debit adjustment = July 6 $1,350 required ending credit balance – $1,800 beginning credit balance 13,750 525 14,275 975 975 500 500 Cash Loss on Sale of Available-for-Sale Securities ($13,750 – $14,275) Investment in Available-for-Sale Securities Allowance for Change in Value ofInvestment Unrealized Increase/Decrease in Value of Available-for-Sale Securities Cash Dividend Revenue Allowance for Change in Value of Investment Unrealized Increase/Decrease in Value of Available-for-Sale Securities 6 Sept. 29 30 805* 805 Cumulative 9/30/10 Change in Fair Value Fair Value $14,230 $ 1,580 19,500 2,050 15,900 (3,200) $49,630 $ 430 *Security 500 shares of Cook Corp. common stock 700 shares of Hill Corp. common stock 200 shares of Web Engines preferred stock Totals $805 debit adjustment = Cost $12,650 17,450 19,100 $49, 200 $430 required ending debit balance + [$1,350 beginning credit balance – $975 debit adjustment (7/6/10)] 19,780 17,450 2,330 Nov. 2 Cash Investment in Available-for-Sale Securities Gain on Sale of Available-for-Sale Securities ($19,780 – $17,450) 15-36 P15-5 (continued) 1. (continued) Nov. Unrealized Increase/Decrease in Value of Available-for-Sale Securities Allowance for Change in Value of Investment Cash Dividend Revenue Allowance for Increase/Decrease in Value of Available-for-Sale Securities Unrealized Change in Value of Investment 2,050 2,050 375 375 Dec. 30 31 550* 550 Cumulative 12/31/10 Change in Fair Value Fair Value $14,280 $ 1,630 16,400 (2,700) $30,680 $(1,070) *Security 500 shares of Cook Corp. common stock 200 shares of Web Engines preferred stock Totals $550 debit adjustment = Cost $12,650 19,100 $31,750 $1,070 required ending credit balance + [$430 beginning debit balance – $2,050 credit adjustment (11/2/10)] March 31 $765a –For Quarte r Ended June 30 Sept. 30 $1,075b $500 – 525 – – Dec. 31 $ 375 – 2,330 2. Dividend revenue Loss on sale of securities Gain on sale of securities a$265 b$375 + $500 + $700 15-37 P15-5 (continued) 3.Current assets: Temporary investment in available-for-sale securities (at cost) Plus (Less): Allowance for change in value of investment Temporary investment in available-for-sale securities (at fair value) March 31 Balance Sheet as of June 30 Sept. 30 Dec. 31 $63,475 (1,800) $61,675 $63,475 (1,350) $62,125 $49,200 430 $49,630 $31,750 (1,070) $30,680 Stockholders' equity: Accumulated Other Comprehensive Income: Unrealized increase(decrease) in value of available-forsale securities $ (1,800) $ (1,350) P15-6 1. 2010 Jan. 1 Investment in Available-for-Sale Securities Cash ($30,000 x 0. 97) Investment in Available-for-Sale Securities Cash ($40,000 x 1. 01) Cash ($30,000 x 0. 08 x 1/2) Investment in Available-for-Sale Securities Interest Revenue ($29,100 x 0. 0 x 1/2) Cash ($40,000 x 0. 10 x 1/2) Investment in Available-for-Sale Securities Interest Revenue ($40,400 x 0. 098 x 1/2) $ 430 $ (1,070) 29,100 29,100 1 40,400 1,200 255 40,400 June 30 1,455 2,000 20 1,980 30 15-38 P15-6 (continued) 1. (continued) June 30 Allowance for Change in Value of Investment Unrealized Increase/Decrease in Value of Available-for-Sale Securities 225* 225 Cumulative Change in Fair Value $ (195) 420 $ 225 *Security $30,000 face value of Bradford Co. bonds $40,000 face value of Morris Co. bonds Totals a$29,100 b$40,400 c$30,000 d$40,000 Amortized 6/30/10 Cost Fair Value a $29,160c $29,355 b 40,800d 40,380 $69,960 $69,735 ost + $255 amortization of discount cost – $20 amortization of premium x 0. 972 x 1. 02 1 Investment in Available-for-Sale Securities Cash ($25,000 x 0. 92) Interest Receivable ($25,000 x 0. 11 x 5/12) Investment in Available-for-Sale Securities Interest Revenue ($23,000 x 0. 12 x 5/12) Cash [($25,000 x 0. 91) + $1,146] Loss on Sale of Availabl e-for-Sale Securities Investment in Available-for-Sale Securities Interest Receivable 23,000 July 23,000 Nov. 30 1,146 4 1,150 23,896 254* 23,004 1,146 30 *$23,004 carrying value ($23,000 cost + $4 amortization of discount) $22,750 proceeds (excluding interest) 15-39 P15-6 (continued) 1. (continued) Dec. 31 Cash ($30,000 x 0. 8 x 1/2) Investment in Available-for-Sale Securities Interest Revenue ($29,355 x 0. 10 x 1/2) Cash ($40,000 x 0. 10 x 1/2) Investment in Available-for-Sale Securities Interest Revenue ($40,380 x 0. 098 x 1/2) Cash ($40,000 x 1. 02) Investment in Available-for-Sale Securities ($40,380 – $21) Gain on Sale of Available-for-Sale Securities ($40,800 – $40,359) Unrealized Increase/Decrease in Value of Available-for-Sale Securities Allowance for Change in Value of Investment (from 6/30/10 schedule) Unrealized Increase/Decrease in Value of Available-for-Sale Securities Allowance for Change in Value of Investment 1,200 268 1,468 2,000 21 1,979 40,800 40,35 9 441 31 31 31 420 420 31 28 628* 12/31/10 Fair Value $28,800b $28,800 Cumulative Change in Fair Value $(823) $(823) *Security $30,000 face value of Bradford Co. bonds Totals a$29,355 b$30,000 Cost $29,623a $29,623 amortized cost (6/30/10) + $268 amortization of discount x 0. 96 = $823 required ending credit balance + [$225 beginning (6/30/10) debit balance – $420 credit adjustment (12/31/10)] $628 credit adjustment 15-40 P15-6 (continued) 2. Interest revenue Loss on sale of securities Gain on sale of securities a$1,455 b$1,150 For Semiannual Period Ended 12/31/10 6/30/10 a $4,597b $3,435 – (254) – 441 + $1,980 + $1,468 + $1,979 Balance Sheet As of 06/30/10 12/31/10 $69,753 225 $69,960 $29,623 (823) $28,800 3.Current assets: Temporary investment in available-for-sale securities (at amortized cost) Plus (Less): Allowance for change in value of investment Temporary investment in available-for-sale securities (at fair value) Stockholders' equity: Accumulated Other Comprehensive Income: Unrealized increase (decrease) in value of available-for-sale securities $225 $(823) P15-7 1. 2010 Feb. 3 Investment in Available-for-Sale Securities Cash (3,000 x $12) Investment in Available-for-Sale Securities Interest Revenue ($20,000 x 0. 12 x 3/12) Cash Cash Interest Revenue ($20,000 x 0. 12 x 6/12) Dividend Revenue (3,000 x $0. 25) 36,000 36,000 Apr. 1 20,000 600 1,950 1,200 750 20,600 June 30 15-41 P15-7 (continued) 1. (continued) Sept. 1 Investment in Available-for-Sale Securities Cash (4,000 x $22) Investment in Available-for-Sale Securities Interest Revenue ($30,000 x 0. 11 x 5/12) Cash Cash Interest Revenue ($30,000 x 0. 11 x 6/12) Cash ($30,000 x 1. 1) Investment in Available-for-Sale Securities Gain on Sale of Available-for-Sale Securities ($30,300 – $30,000) Cash Dividend Revenue (3,000 x $0. 25) Cash Loss on Sale of Available-for-Sale Securities ($35,300 – $36,000) Investment in Available-for-Sale Securities Cash Interest Revenue ( $20,000 x 0. 12 x 6/12) Allowance for Change in Value of Investment Unrealized Increase/Decrease in Value of Available-for-Sale Securities 88,000 88,000 Nov. 1 30,000 1,375 1,650 1,650 30,300 30,000 300 750 35,300 700 36,000 1,200 1,200 4,200* 4,200 750 31,375 Dec. 1 1 30 30 31 31 15-42 P15-7 (continued) 1. (continued) Cost *Security $20,000 face value of Solomon Co. bonds $ 20,000 4,000 shares of Woodman Corp. ommon stock 88,000 Totals $108,000 a$20,000 b4,000 Cumulative 12/31/10 Change in Fair Value Fair Value $ 200 $ 20,200a 92,000b 4,000 $112,200 $4,200 x 1. 01 x $23 $2,075 (-$600+$1,200-$1,375+$1,650+$1,200) 1,500 ($750+$750) 300 (700) 2. Interest revenue Dividend revenue Gain on sale of securities Loss on sale of securities 3. Current assets: Temporary investment in available-for-sale securities (at cost) Plus: Allowance for change in value of investment Temporary investment in available-for-sale securities (at fair value) $108,000 4,200 $112,200 P15-8 Note to Instructor: This problem contains petty cash journal entries and a bank reconciliation, previously covered in Chapter 7. 1. 2010 Jan. Investment in Available-for-Sale Securities [(150 x $20) + (200 x $30) + (100 x $25)] Cash Investment in Available-for-Sale Securities ($20,000 + $12,000) Interest Revenue [($20,000 x 0. 12 x 5/12) + ($12,000 x 0. 10 x 4/12)] Cash Petty Cash Cash 11,500 11,500 Feb. 1 32,000 1,400 500 33,400 500 1 15-43 P15-8 (continued) 1. (continued) Feb. 28 Cash Interest Revenue [$20,000 x 0. 12 x 6/12] Postage Expense Office Supplies Expense Transportation Expense Miscellaneous Expense Cash Cash Short and Over Cash a$125. 50 1,200 1,200 110. 00 170. 65 45. 00 43. 50 5. 35a 28 369. 15 5. 35 28 – ($500. 00 – $369. 15) 2,100 200 1,500 800 Mar. 31 Cash ($1,500 + $600) Interest Receivable ($20,000 x 0. 12 x 1/12; A Co. bonds) Dividend Revenue Interest Revenue [($12,000 x 0. 0 x 6/12) + ($20,000 x 0. 12 x 1/12)] Unrealized Increase/Decrease in Value of Available-for-Sale S ecurities Allowance for Change in Value of Investment b$42,600 31 900 900b – ($11,500 + $32,000) 140. 00 75. 30 54. 20 31 Postage Expense Office Supplies Expense Miscellaneous Expense Cash 269. 50 15-44 P15-8 2. (continued) PAYNE CORPORATION Bank Reconciliation March 31, 2010 Balance per bank statement Add: Deposits in transit Deduct: Outstanding checks Adjusted cash balance Balance per company records Add: Note collected by bank Interest on note Deduct: Bank service charge NSF check returned Adjusted cash balance 3. 2010 Mar. 31 Cash Notes Receivable Interest Revenue