Shopify Inc. reported the following (adapted) information in its 2016 balance sheet:

Current assets ..................................... (in thousands of US dollars)
Cash and cash equivalents ..................................... $ 84,013
Marketable securities ................................................ 308,401

Assume that the carrying value (and cost) of Shopify’s short-term investments is $303,901,000 prior to the year-end adjustment to fair value.

Required

1. Write a brief note to identify the method used to report short-term investments and to disclose cost and fair value.
2. Show the journal entry that would have been made by Shopify if you determine that a journal entry was needed at year-end.