International Finance and Accounting Handbook

21 • 31

20X2

Balance sheetAssets

Liabilities and Equity

__________________________________________

______________________________________

Cash

$

70.47

Cash

$

1,082.30

Equity

$

1,000.00

Subordinated Interest (AFS)

$

39.49

Subordinated Interest (AFS)

97.36

Unrealized gain

7.31

Interest Income on Subordinated Interest

30.98

Servicing Asset

9.29

Retained earnings

181.64

________________

_______________

$

1,188.95

$

1,188.95

________________

_______________

________________

_______________

Record accretion on Subordinated Interest and interest received from SPE

Cash

$

16.49

Income Statement

Servicing Expense

5.95

Servicing Income

$

16.49

Income

Expense

__________________________________________

______________________________________

Servicing Asset

5.95

Gain from securitization

$

—

Other

$

—

Amortize Servicing Asset and record the contractual servicing fee

Interest Income on Subor

30.98

Servicing Expense

5.95

Servicing Income

16.49

________________

_______________

Unrealized gain

$

5.38

$

47.47

$

5.95

________________

_______________

________________

_______________

Subordinated Interest (AFS)

$

5.38

Record the SFAS 115 AFS adjustment

20X3

Balance sheetAssets

Liabilities and Equity

__________________________________________

______________________________________

Cash

$

59.84

Cash

$

1,154.86

Equity

$

1,000.00

Subordinated Interest (AFS)

$

38.30

Subordinated Interest (AFS)

55.05

Unrealized gain

3.30

Interest income

21.54

Servicing Asset

4.70

Retained earnings

211.31

________________

_______________

$

1,214.61

$

1,214.61

________________

_______________

________________

_______________

Record accretion on Subordinated Interest and interest received from SPE

Income Statement

Cash

$

12.72

Servicing Expense

4.59

Income

Expense

__________________________________________

______________________________________

# Servicing Income

$

12.72

Servicing Asset

4.59

Gain from securitization

$

—

Other

$

—

Interest Income on Subor

21.54

Servicing Expense

4.59

Amortize Servicing Asset and record the contractual servicing fee

Servicing Income

12.72

________________

_______________

$34.26

$4.59

________________

_______________

________________

_______________

Unrealized gain

$

4.01

Subordinated Interest (AFS)

$

4.01

Record the SFAS 115 AFS adjustment

Appendix A.

(Continued

)