Exercise:
Biomet Inc. provided the following disclosures in Note 4 of its 2012 annual report. It describes the company's investments in available-for-sale equity securities (dollars in millions).
|
Cost
|
Gains
|
Losses
|
|
2012
|
$16.2
|
$0.0
|
(0.2)
|
|
2011
|
79.0
|
0.1
|
(4.7)
|
1. Compute the fair market value of Biomet's available-for-sale equity portfolio for both 2012 and 2011.
2. What was the effect on the company's comprehensive income amount associated with its available-for-sale securities?
3. Assume that Biomet sold its entire portfolio of available-for-sale securities at the end of 2012. How much income would be realized on the sale? Provide the journal entry.