This scenario describes how you convert a JVLCLP security when you use the Equity Method (EMA) accounting method. When you use the equity method of accounting for a position, you can hold positions that use the Equity Method (EMA) accounting method as well as positions that use the STAR accounting method. This scenario describes the Equity Method (EMA).
For this scenario the Entity (EMAENT) has two bases:
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The system creates new positions for both STAT and GAAP, sets them to EMA, with the following ledger activity. Accounts specific to the equity method of accounting appear in yellow.
STAT Treatment
Account | Account | Debit | Credit |
---|---|---|---|
1010000100 | COST OF INVESTMENTS | 10,000.00 | 0.00 |
9999999992 | CONVERSION COST | 0.00 | 10,000.00 |
1011000103 | UNREALIZED APPRECIATION OF UNDISTRIBUTED INCOME | 600.00 | 0.00 |
1011000101 | UNREALIZED APPRECIATION OF INVESTMENTS | 300.00 | 0.00 |
3003000335 | ACCUMULATED UNREALIZED GAIN/LOSS ALLOCATED TO CAPITAL | 0.00 | 300.00 |
1011000202 | UNREALIZED CURRENCY DEPRECIATION OF INVESTMENTS | 0.00 | 200.00 |
3003000336 | ACCUMULATED UNREALIZED CURRENCY GAIN/LOSS ALLOCATED TO CAPITAL | 200.00 | 0.00 |
3003000337 | ACCUMULATED UNREALIZED INCOME/LOSS | 0.00 | 600.00 |
Other Treatment
Account | Account | Debit | Credit |
---|---|---|---|
1010000100 | COST OF INVESTMENTS | 10,600.00 | 0.00 |
9999999992 | CONVERSION COST | 0.00 | 10,000.00 |
1011000101 | UNREALIZED APPRECIATION OF INVESTMENTS | 300.00 | 0.00 |
3003000335 | ACCUMULATED UNREALIZED GAIN/LOSS ALLOCATED TO CAPITAL | 0.00 | 300.00 |
1011000202 | UNREALIZED CURRENCY DEPRECIATION OF INVESTMENTS | 0.00 | 200.00 |
3003000336 | ACCUMULATED UNREALIZED CURRENCY GAIN/LOSS ALLOCATED TO CAPITAL | 200.00 | 0.00 |
3003000338 | ACCUMULATED UNDISTRIBUTED INVESTMENT INCOME | 0.00 | 600.00 |
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