Question
Gruden Bancorp Inc. purchased a portfolio of trading securities during 20Y3, its first year of operations. The cost and fair value of this portfolio on
Gruden Bancorp Inc. purchased a portfolio of trading securities during 20Y3, its first year of operations. The cost and fair value of this portfolio on December 31, 20Y3, are as follows:
| 1 | Issuing Company | Cost | Fair Value |
|---|---|---|---|
| 2 | Griffin Inc. | $29,200.00 | $32,120.00 |
| 3 | Luck Company | 30,000.00 | 26,400.00 |
| 4 | Wilson Company | 30,600.00 | 26,350.00 |
| 5 | Total | $89,800.00 | $84,870.00 |
On May 10, 20Y4, Gruden Bancorp Inc. purchased trading securities of Carroll Inc. for $25,870.
Required:
| Journalize the entries to record the following:
|
CHART OF ACCOUNTS Gruden Bancorp Inc. General Ledger
| ASSETS | |
|---|---|
| 110 | Cash |
| 111 | Petty Cash |
| 120 | Accounts Receivable |
| 121 | Allowance for Doubtful Accounts |
| 131 | Notes Receivable |
| 132 | Interest Receivable |
| 141 | Merchandise Inventory |
| 145 | Office Supplies |
| 146 | Store Supplies |
| 151 | Prepaid Insurance |
| 161 | Trading Investments-Carroll Inc. |
| 165 | Valuation Allowance for Trading Investments |
| 166 | Valuation Allowance for Available-for-Sale Investments |
| 181 | Land |
| 191 | Store Equipment |
| 192 | Accumulated Depreciation-Store Equipment |
| 193 | Office Equipment |
| 194 | Accumulated Depreciation-Office Equipment |
| LIABILITIES | |
|---|---|
| 210 | Accounts Payable |
| 221 | Notes Payable |
| 231 | Interest Payable |
| 241 | Salaries Payable |
| 251 | Sales Tax Payable |
| EQUITY | |
|---|---|
| 311 | Common Stock |
| 312 | Paid-In Capital in Excess of Par-Common Stock |
| 321 | Preferred Stock |
| 322 | Paid-In Capital in Excess of Par-Preferred Stock |
| 331 | Treasury Stock |
| 332 | Paid-In Capital from Sale of Treasury Stock |
| 340 | Retained Earnings |
| 350 | Unrealized Gain on Available-for-Sale Investments |
| 351 | Cash Dividends |
| 352 | Stock Dividends |
| REVENUE | |
|---|---|
| 410 | Sales |
| 411 | Interest Revenue |
| 412 | Dividend Revenue |
| 421 | Income of Carroll Inc. |
| 431 | Gain on Sale of Investments |
| 641 | Unrealized Gain on Trading Investments |
| 642 | Unrealized Loss on Trading Investments |
| EXPENSES | |
|---|---|
| 511 | Cost of Merchandise Sold |
| 512 | Bad Debt Expense |
| 515 | Credit Card Expense |
| 516 | Cash Short and Over |
| 520 | Salaries Expense |
| 531 | Advertising Expense |
| 532 | Delivery Expense |
| 533 | Repairs Expense |
| 534 | Selling Expenses |
| 535 | Rent Expense |
| 536 | Insurance Expense |
| 537 | Office Supplies Expense |
| 538 | Store Supplies Expense |
| 561 | Depreciation Expense-Store Equipment |
| 562 | Depreciation Expense-Office Equipment |
| 590 | Miscellaneous Expense |
| 710 | Interest Expense |
| 721 | Loss of Carroll Inc. |
| 731 | Loss on Sale of Investments |
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Accounting
Authors: Carl s. warren, James m. reeve, Philip e. fess
21st Edition
978-0324400205, 324225016, 324188005, 324400209, 9780324225013, 978-0324188004
