Question
Exercise 17-7 On December 21, 2017, Swifty Company provided you with the following information regarding its equity investments. December 31, 2017 Investments (Trading) Cost Fair
Exercise 17-7
On December 21, 2017, Swifty Company provided you with the following information regarding its equity investments.
December 31, 2017 | |||||||
Investments (Trading) | Cost | Fair Value | Unrealized Gain (Loss) | ||||
Clemson Corp. stock | $19,900 | $18,900 | $(1,000 | ) | |||
Colorado Co. stock | 10,300 | 9,200 | (1,100 | ) | |||
Buffaloes Co. stock | 19,900 | 20,460 | 560 | ||||
Total of portfolio | $50,100 | $48,560 | (1,540 | ) | |||
Previous fair value adjustment balance | 0 | ||||||
Fair value adjustmentCr. | $(1,540 | ) |
During 2018, Colorado Company stock was sold for $9,750. The fair value of the stock on December 31, 2018, was Clemson Corp. stock$19,000; Buffaloes Co. stock$20,350. None of the equity investments result in significant influence.
(a) | Prepare the adjusting journal entry needed on December 31, 2017. | |
(b) | Prepare the journal entry to record the sale of the Colorado Co. stock during 2018. | |
(c) | Prepare the adjusting journal entry needed on December 31, 2018. |
(Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
No. | Account Titles and Explanation | Debit | Credit |
(a) | |||
(b) | |||
(c) | |||
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