M. Jones Inc. purchased the following available-for-sale securities during 20Y5, its first year of operations:

Issuing Company	Cost
Arden Enterprises Inc.	$134,400
French Broad Industries Inc.	58,520
Pisgah Construction Inc.	106,880
	$299,800

The fair value of the various available-for-sale securities on December 31, 20Y5, was as follows:

Issuing Company	Fair Value, Dec. 31, 20Y5
Arden Enterprises Inc.	$163,200
French Broad Industries Inc.	71,820
Pisgah Construction Inc.	100,200
	$335,220

Required:

a.	Journalize the adjusting entry for the fair value of the portfolio of securities on December 31, 20Y5.*
b.	If the fair value of the portfolio of securities were the same on December 31, 20Y6, what would be the journal entry to adjust the portfolio to fair value?*
c.	If the fair value of the portfolio of securities was $337,320 on December 31, 20Y6, what would be the journal entry to adjust the portfolio to fair value?*
d.	If the fair value of the portfolio of securities was $328,720 on December 31, 20Y6, what would be the journal entry to adjust the portfolio to fair value?*
	*Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered. If no entry is required, simply skip to the next transaction.

CHART OF ACCOUNTS

M. Jones 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
162	Available-for-Sale Investments
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
350.1	Unrealized Loss on Available-for-Sale Investments
351	Cash Dividends
352	Stock Dividends

	REVENUE
410	Sales
611	Interest Revenue
612	Dividend Revenue
631	Gain on Sale of Investments
641	Unrealized Gain on Trading Investments

a.	Journalize the adjusting entry for the fair value of the portfolio of securities on December 31, 20Y5.*
b.	If the fair value of the portfolio of securities were the same on December 31, 20Y6, what would be the journal entry to adjust the portfolio to fair value?*
c.	If the fair value of the portfolio of securities was $337,320 on December 31, 20Y6, what would be the journal entry to adjust the portfolio to fair value?*
d.	If the fair value of the portfolio of securities was $328,720 on December 31, 20Y6, what would be the journal entry to adjust the portfolio to fair value?*
	*Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered. If no entry is required, simply skip to the next transaction.

PAGE 10

JOURNAL

ACCOUNTING EQUATION

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
1
2
3
4
5
6