During 2014, its first year of operations, Galileo Company purchased two available for-sale investments as follows: Assume

Question:

During 2014, its first year of operations, Galileo Company purchased two available for-sale investments as follows:

Assume that as of December 31, 2014, the Hawking Inc. stock had a market value of $50 per share, and the Pavlov Co. stock had a market value of $24 per share. Galileo Company had net income of $300,000, and paid no dividends for the year ended
December 31, 2014. All of the available-for-sale investments are classified as current assets.
a. Prepare the Current Assets section of the balance sheet presentation for the available for sale investments.
b. Prepare the Stockholdersâ€™ Equity section of the balance sheet to reflect the earnings and unrealized gain (loss) for the available-for-saleinvestments.

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...