Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

During January 2017, Long Corporation for the first time decided to acquire some equity securities as a means of putting some of its idle cash

During January 2017, Long Corporation for the first time decided to acquire some equity securities as a means of putting some of its idle cash to work. The securities are classified as trading securities. At March 31, when Long prepares its first quarter financial statements, the following information about the acquired securities is available:

Securities

Cost

Market

1

$52,000

$50,000

2

32,000

29,000

3

35,000

27,000

Required:

a.

Prepare the journal entries to record the acquisition in January and valuation at the end of the first quarter of 2017.

b.

Assume that on June 30, 2017, the company still has this same portfolio. The market value of 1 is $57,000, 2 is $30,000, and 3 is $31,000. What journal entry, if any, should be prepared at the end of the second quarter?

c.

On August 15, 2017, Long Corporation sold Security 3 for $33,000. Prepare the journal entry to record this transaction.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Foundations Of Cost Control

Authors: Daniel Traster

1st Edition

0132156555, 978-0132156554

More Books

Students also viewed these Accounting questions

Question

4. Avoid pointing or gesturing.

Answered: 1 week ago

Question

I dont trust that theyll keep my complaint confi dential.

Answered: 1 week ago