Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On December 21, 2017, Grouper Company provided you with the following information regarding its equity investments. December 31, 2017 Investments (Trading) Cost Fair Value Unrealized

On December 21, 2017, Grouper Company provided you with the following information regarding its equity investments.

December 31, 2017

Investments (Trading)

Cost

Fair Value

Unrealized Gain (Loss)

Clemson Corp. stock $ 18,900 $ 17,900 $( 1,000 )
Colorado Co. stock 9,000 8,000 ( 1,000 )
Buffaloes Co. stock 18,900 19,540 640
Total of portfolio $ 46,800 $ 45,440 ( 1,360 )
Previous fair value adjustment balance 0
Fair value adjustmentCr. $( 1,360 )

During 2018, Colorado Company stock was sold for $ 8,550. The fair value of the stock on December 31, 2018, was Clemson Corp. stock$ 18,010; Buffaloes Co. stock$ 19,430. None of the equity investments result in significant influence.

(a) Prepare the adjusting journal entry needed on December 31, 2017.
(b) Prepare the journal entry to record the sale of the Colorado Co. stock during 2018.
(c) Prepare the adjusting journal entry needed on December 31, 2018.

(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.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial And Managerial Accounting 15th Edition Text Only

Authors: Jan Williams

15th Edition

B005FCGT4O

More Books

Students also viewed these Accounting questions

Question

How could the halo effect bias a pretest for a soft-drink ad?

Answered: 1 week ago