Journal Questions
1. Michael James bought 8,500 shares of NovoSotia on April 15 for $12 per share. On the same day the closing price of NovoSotia was $11.45 per share. Calculate the unrealized gains/loss at end of day and pass the journal entry.
2. On April 24 he sold 4,000 shares of NovoSotia at $14 per share. Pass necessary journal entries to record the sale of these shares and also the subsequent realized/unrealized gain or loss as of that date. The closing rate of NovoSotia shares on April 24 is $13.60.
3. On May 31, NovoSotia declared a dividend of $1 per share with record date of April 20. On June 10 the payment was made. Calculate the dividend amount received by Michael James and also pass entries for dividend declaration and actual receipt of such dividend.
4. On June 25 Mr. James bought an additional 2,000 shares of NovoSotia at $16 per share. On July 28 he sold another 4,000 shares at $14.65 per share. Mr. James follows the last in, first out (LIFO) method and the shares were held for trading purposes. Calculate the realized gains or loss and pass entry to give the effect for the same.
5. Prepare realized/unrealized gains and loss account (ledger account) giving effect to the preceding transactions.
Trading Securities: Foreign Currency—HKD
For the following scenario, prepare journal entries, general ledgers, trial balances, income statements, and balance sheets.
James Trading Inc. traded in Avichina Industry shares in a Hong Kong stock exchange through Nomura Securities brokers, and the details are as follows.
Trade Details
Date Product Quantity Rate B/S Brokerage
8-Jan-X1 Avichina Industry 35,000 1.33HKD B 155 HKD
12-Jan-X1 Avichina Industry 20,000 1.39 HKD B 120 HKD
15-Feb-X1 Avichina Industry 50,500 1.25 HKD S 195 HKD
Other Details
Settlement: T + 3
Liquidation Method
FIFO
Market Rate of Avichina Industry Shares in HKD
January 31: 1.28.
February 28: 1.42.
March 31: 1.55.
FX Rate: USD/HKD
January 8: 7.72
January 11: 7.79
January 12: 7.69
January 15: 7.90
January 31: 7.83
February 15: 7.75
February 18: 7.81
February 28: 7.76
March 31: 7.99
Functional Currency
USD
Trading Securities: Foreign Currency—IDR
For the following scenario, prepare journal entries, general ledgers, trial balance, income statement, and balance sheet.
Jakarta Trading Fund traded in PT. Perusahaan Gas shares in a Hong Kong stock exchange through Vickers & Co. brokers, and the details are as follows.
Trade Details
Date Product Quantity Rate (IDR) B/S Brokerage (IDR)
5-Jan-X1 PT. Perusahaan 16,000 10,071.39 B 161,150,080
15-Jan-X1 PT. Perusahaan 18,000 10,329.90 B 171,200,000
5-Feb-X1 PT. Perusahaan 30,500 10,700.00 S 271,200,000
Other Details
Settlement: T + 3
Liquidation Method
FIFO
Market Rate of PT. Perusahaan Shares in IDR
January 31: 10,101.10
February 28: 10,800.42
March 31: 10,255.15
FX Rate: USD/IDR
January 5: 9,013
January 8: 9,040
January 15: 9,115
January 18: 9,102
January 31: 9,100
February 5: 9,070
February 8: 9,109
February 28: 9,120
March 31: 9,125
Functional Currency
USD
Trading Securities: Foreign Currency—PKR
For the following scenario, prepare journal entries, general ledgers, trial balance, income statement, and balance sheet.
Karachi Overseas Fund traded in Adamjee Insurance shares in the Pakistan stock exchange through Auerbach & Co. brokers, and the details are as follows.
Trade Details
Date Product Quantity Rate B/S Brokerage
15-Feb-X1 Adamjee 2,000 189 PKR B 378 PKR
15-Mar-X1 Adamjee 1,600 198 PKR S 316 PKR
Other Details
Settlement: T + 3
Liquidation Method
FIFO
Market Rate of Adamjee Insurance Shares in PKR
February 28: 190
March 31: 185
April 30: 205
FX Rate: USD/PKR
February 15: 60.81
February 18: 60.68
February 28: 60.71
March 15: 60.75
March 18: 60.72
March 31: 60.73
April 30: 60.78
Functional Currency
USD
Trading Securities: Foreign Currency—JPY
For the following scenario, prepare journal entries, general ledgers, trial balance, income statement, and balance sheet.
Itochu Capital Japan Fund traded in Nissan shares in the Nikkei through Akita Mori brokers, and the details are as follows.
Trade Details
Date Product Quantity Rate(JPY) B/S Brokerage (JPY)
11-Feb-X1 Nissan 4,000 1,450 B 1,200
20-Mar-X1 Nissan 2,200 1,750 S 660
Other Details
Settlement: T + 3
Liquidation Method
FIFO
Market Rate of Nissan Shares in JPY
February 28: 1,620
March 31: 1,800
April 30: 1,760
FX Rate: USD/JPY
February 11: 104.50
February 28: 104.85
March 20: 105.25
March 31: 105.00
April 30: 105.50
Functional Currency
USD
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