E17.6 (LO 2) (Entries for Equity Securities) The following information is available for Barkley Company at December 31, 2020, regarding its investments. Securities Cost Fair Value 3,000 shares of Myers Corporation common stock $40,000 $48,000 1,000 shares of Cole Incorporated preferred stock 25,000 22,000 $65,000 $70,000

Instructions

a. Prepare the adjusting entry (if any) for 2020, assuming no balance in the Fair Value Adjustment account at January 1, 2020. Neither of Barkley's investments result in significant influence.

b. Discuss how the amounts reported in the financial statements are affected by the entries in (a).