Exercise 17-9 (Part Level Submission)

At December 31, 2017, the available-for-sale debt portfolio for Stellar, Inc. is as follows.

Security Cost Fair Value Unrealized Gain (Loss)

A $25,375 $21,750 $(3,625)

B 18,125 20,300 2,175

C 33,350 36,975 3,625

Tota l$76,850 $79,025 2,175

Previous fair value adjustment balanceDr.580

Fair value adjustmentDr.$1,595

On January 20, 2018, Stellar, Inc. sold security A for $21,895. The sale proceeds are net of brokerage fees.

(a)

Prepare the adjusting entry at December 31, 2017, to report the portfolio at fair value.(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.)

Account Titles and Explanation Debit Credit

__________________________ __________ ____________

__________________________ __________ ____________