Hurricane Inc. purchased a portfolio ofavailable-for-sale securitiesin 2016, its first year of operations. The cost and fair value of this portfolio on December 31, 2016, was as follows:

1	Name	Number of Shares	Total Cost	Total Fair Value
2	Tornado Inc.	780.00	$13,884.00	$15,678.00
3	Tsunami Corp.	1,200.00	30,960.00	33,600.00
4	Typhoon Corp.	2,150.00	43,860.00	43,000.00
5	Total		$88,704.00	$92,278.00

On June 12, 2017, Hurricane purchased 1,410 shares of Rogue Wave Inc. at $45 per share plus a $90 brokerage commission.

Required:

A.

Provide the journal entries to record the following (refer to the Chart of Accounts for exact wording of account titles and be sure to enter the year as part of the date):

1.	The adjustment of the available-for-sale security portfolio to fair value on December 31, 2016.
2.	The June 12, 2017, purchase of Rogue Wave Inc. stock.

B.

How are unrealized gains and losses treated differently for available-for-sale securities than for trading securities?

A. Provide the journal entries. Refer to the Chart of Accounts for exact wording of account titles. Be sure to enter the year as part of the date. PAGE 10 JOURNAL

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