Question
Glaser Company carries the following investments on its books at December 31, 2020 and December 31, 2021.Available for-Sale securities are considered to be non-current.All securities
Glaser Company carries the following investments on its books at December 31, 2020 and December 31, 2021.Available for-Sale securities are considered to be non-current.All securities were purchased and properly recorded during February 2020. You need tocombineall trading and AFS securities into trading portfolio and AFS portfolio, respectively, while making the fair value adjustment entries.
Market Value
Market Value
Cost
12/31/2020
12/31/2021
Stock in A
Trading(TS)
$300
$ 250
$230
Stock in B
Trading (TS)
250
190
----
Stock in C
Available-for-sale (AFS)
400
430
445
Stock in D
Available-for-sale (AFS)
375
330
335
Required:
- Prepare the necessaryfair value adjusting journal entriesfor Glaser on December 31, 2020.
- Assume Glaser sold its investment in "B" for $125 on December 15, 2021; preparejournal entries forsales of investmenton December 15 andfair value adjusting journal entrieson December 31, 2021.
- Ignoring income taxes and assuming both the retained earnings and accumulated other comprehensive income have a balance of 0 on December 31, 2019, complete the following schedule:
December 31
2020
2021
Income Statement:
Realized gains and losses on investments
Unrealized gains and losses on investments
Balance Sheet:
Current assets:
Investments at fair value-trading
Non-Current assets:
Investments at fair value-AFS
Stockholders' Equity
Retained earnings
Accumulated other comprehensive income
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started