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Question: e114 impairment of afs and htm investments us gaap and...

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E1.14 Impairment of AFS and HTM Investments, U.S. GAAP and IFRS Assume The Coca-Cola Lo1,4 Company reports the following investments at December 31, 2016. prior to any required end-of-year valuation adjustments: Investment in debt securities. 600,000 Coca-Cola classifies its investment in cquity securitics as AFS, and its investment in debt securities as HTM. The December 31,2016, fair value of the equity securities is $1,000,000, and the fair value of the debt securities is $400,000. Required The equity securities were originally purchased for $1,600.000. a. Record any required journal entries to reflect fair values at year-end, assuming the investments are b. If Coca-Cola follows IFRS, are there any differences in how the value changes are recorded? Are c. It is now December 31, 2017. Coca-Cola still holds both investments. The fair value of the equity (1) not impaired, and (2) impaired, following U.S. GAAP there differences in the decision to treat an investment as impaired? Explain. securities is $1,400,000 and the fair value of the debt securities i basis, the debt securities balance would be $590,000 if no impairment loss had s $640,000. On an amortized cos y required journal entries at year-end, following (1) U.s. GAAP, and (2) IFRS, assumingt securities were impaired in 2016.

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