On December 21, 2015, Zurich Company provided you with the following information regarding its trading investments.

During 2016, Carolina Co. shares were sold for €9,500. The fair value of the shares on December 31, 2016, was Stargate Corp. shares—€19,300; Vectorman Co. shares—€20,500.
Instructions

(a) Prepare the adjusting journal entry needed on December 31, 2015.

(b) Prepare the journal entry to record the sale of the Carolina Co. shares during 2016.

(c) Prepare the adjusting journal entry needed on December 31, 2016.

Transcribed Image Text:

December 31, 2015 Fair Value Unrealized Gain (Loss) (1,000) Investments (Trading) Cost Stargate Corp. shares 20,000 19,000 Carolina Co. shares 10,000 9,000 Vectorman Co. shares 20,000 20,600 Total of portfolio 50,000 48,600 Previous fair value adjustment balance Fair value adjustment-Cr. (1,000) 600 (1,400) -0- (1,400)