Jupiter Insurance Co. is an insurance company that began operations on January 1, 2015. The following transactions
Question:
2015
Feb. 21. Purchased 3,000 shares of Loral Ltd. as a held-for-trading investment at $25 per share plus a brokerage commission of $600.
Mar. 2. Purchased 900 shares of Monarch Inc. as a held-for-trading investment at $52 per share plus a brokerage commission of $180.
May 3. Sold 800 shares of Loral Ltd. for $23.50 per share less an $80 brokerage commission.
Jun. 8. Received an annual dividend of $0.18 per Loral Ltd. share.
Dec. 31.The held-for-trading investments were adjusted to fair values of $24 and $48 per share for Loral Ltd. and Monarch Inc., respectively.
2016
May 11. Purchased 1,600 shares of Echelon Co. as a held-for-trading investment at $18 per share plus a $160 brokerage commission.
Jun. 11. Received an annual dividend of $0.20 per Loral Ltd. share.
Aug. 14. Sold 400 shares of Echelon Co. for $20 per share less an $80 brokerage commission.
Dec. 31. The held-for-trading investments were adjusted to fair value using the following fair values per share for the held-for-trading securities:
Echelon Co. ..................... $22
Loral Ltd. ........................ 23
Monarch Inc. ..................... 49
Instructions
1. Journalize the entries to record these transactions.
2. Prepare the investment-related current asset statement of financial position disclosures for Jupiter Insurance Co. on December 31, 2016.
3. How are unrealized holding gains or losses on held-for-trading investments disclosed in the financial statements of Jupiter Insurance Co.?
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Related Book For
Accounting Volume 2
ISBN: 978-0176509743
2nd Canadian edition
Authors: James Reeve, Jonathan Duchac, Sheila Elworthy, Carl S. Warren
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