Loose Leaf for Financial Accounting: Information for Decisions
9th Edition
ISBN: 9781260158762
Author: John J Wild
Publisher: McGraw-Hill Education
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Chapter C, Problem 7E
Summary Introduction
Concept Introduction:
Investment in available of sale securities is made for a short term period to earn a short term gain. The period of holding of these securities is usually less than one year. These investments are recorded at fair value on the balance sheet date and any gain or loss on revaluation is recorded as unrealized gain or loss on investment.
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On December 31, Lujack Company held the following short-term available-for-sale securities. Lujack had no short-
term investments prior to the current period.
Prepare the December 31 year-end adjusting entry to record the fair value adjustment for these debt securities.
Complete this question by entering your answers in the tabs below.
General
Journal
Fair Value
Adjustment
Computation of fair value adjustment.
Available-for-Sale Securities
Nintendo Company notes
Atlantic bonds
Kellogg Company notes
McDonald's Corporation bonds
Totals
Computation of Fair Value Adjustment
$
Cost
Fair Value
50,100 $ 54,609
18,637
33,908
20,040
36,072
67,635
64,253
$ 173,847 $ 171,407
Fair Value Adjustment
Unrealized
Amount
General Journal
Gain or Loss?
>
On December 31, Reggit Company held the following short-term investments in its portfolio of available-for-sale debt
securities. Reggit had no short-term investments in its prior accounting periods.
Available-for-Sale Securities
Verrizano Corporation bonds
Preble Corporation notes
Lucerne Company bonds
epare the December 31 adjusting entry to report these investments at fair value.
Fair Value
Adjustment
Computation of fair value adjustment.
Complete this question by entering your answers in the tabs below.
General
Journal
Cost
$ 76,000
57,000
72,000
Verrizano Corporation bonds
Preble Corporation notes
Lucerne Company bonds
Total
Fair Value Adjustment Computation - Available for Sale Portfolio
Unrealized
Amount
Cost
$
Fair Value
$ 74,480
50,730
69,120
Fair Value
76,000 $ 74,480
57,000
50,730
72,000
69,120
$ 205,000 $ 194,330
CO
On December 31, Reggit Company held the following short-term investments in its portfolio of availablefor- sale debt securities. Reggit had no short-term investments in its prior accounting periods. Prepare the December 31 adjusting entry to report these investments at fair value. Available-for-Sale Securities Cost Fair Value Verrizano Corporation bonds $89,600 $91,600 Preble Corporation notes 70,600 62,900 Lucerne Company bonds 86,500 83,100
Chapter C Solutions
Loose Leaf for Financial Accounting: Information for Decisions
Ch. C - Under what two conditions should investments be...Ch. C - Prob. 2DQCh. C - Prob. 3DQCh. C - Identify the three classes of debt investments and...Ch. C - Prob. 5DQCh. C - Prob. 6DQCh. C - Prob. 7DQCh. C - Prob. 8DQCh. C - Prob. 9DQCh. C - Prob. 10DQ
Ch. C - Prob. 11DQCh. C - Prob. 12DQCh. C - Prob. 13DQCh. C - Prob. 14DQCh. C - Which of the following statements a through g are...Ch. C - Prob. 2QSCh. C - Prob. 3QSCh. C - Prob. 4QSCh. C - Prob. 5QSCh. C - Prob. 6QSCh. C - Journ Co. purchased short-term investments in...Ch. C - Prob. 8QSCh. C - Prob. 9QSCh. C - Prob. 10QSCh. C - Prob. 11QSCh. C - Prob. 12QSCh. C - Complete the following descriptions by filling in...Ch. C - Complete the following descriptions by filling in...Ch. C - Prob. 15QSCh. C - Prob. 17QSCh. C - Complete the following descriptions by filling in...Ch. C - Prob. 2ECh. C - Prob. 4ECh. C - Prob. 5ECh. C - Prob. 6ECh. C - Prob. 7ECh. C - Use the following information of Prescrip Co. to...Ch. C - Prob. 9ECh. C - Prob. 10ECh. C - Prob. 12ECh. C - Complete the following descriptions by filling in...Ch. C - Prob. 14ECh. C - Prob. 1PSACh. C - Prob. 3PSACh. C - Prob. 4PSACh. C - Prob. 5PSACh. C - Prob. 6PSACh. C - Prob. 1PSBCh. C - Prob. 3PSBCh. C - Prob. 4PSBCh. C - Prob. 5PSBCh. C - Prob. 6PSBCh. C - Prob. CSPCh. C - Prob. 1GLPCh. C - Prob. 2GLPCh. C - Prob. 1FSACh. C - Prob. 2FSACh. C - Prob. 3FSACh. C - Prob. 2BTN
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