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On its December 31, 2020 balance sheet, Gangus Company appropriately reported a $8,000 debit balance in its Fair Value Adjustment account. There was no change

  1. On its December 31, 2020 balance sheet, Gangus Company appropriately reported a $8,000 debit balance in its Fair Value Adjustment account. There was no change during early 2020 in the composition of Ganguss portfolio of equity investments.

The following information pertains to that portfolio on March 31, 2021:

Security

Cost

Fair Value at March 31, 2021

Meyers Co. Common Stock

$220,000

$218,000

Slinko, Inc. Common Stock

85,000

87,000

Hammer Corp. Common Stock

150,000

137,000

$455,000

$442,000

Instructions

Prepare the journal entries for Gangus Company for:

  1. the fair value adjusting entry necessary at March 31, 2021 (assume Gangus is preparing quarterly financial statements.).
  2. the April 10, 2021 sale of all the Bennis Inc. common stock investment for $88,000.

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