(a) Assuming no Securities Fair Value Adjustment account balance at the beginning of the year, prepare the adjusting entry at the end of the year if Laura Company’s trading bond investment has a fair value €60,000 below carrying value.
(b) Assume the same information as part (a), except that Laura Company has a debit balance in its Securities Fair Value Adjustment account of €10,000 at the beginning of the year. Prepare the adjusting entry at year-end.