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On January 1, 2016, Valuation Allowance for Available-for-Sale Investments had a zero balance. On December 31, 2016, the cost of the available-for-sale securities was $72,700,

On January 1, 2016, Valuation Allowance for Available-for-Sale Investments had a zero balance. On December 31, 2016, the cost of the available-for-sale securities was $72,700, and the fair value was $66,290.

Prepare the adjusting entry to record the unrealized gain or loss on available-for-sale investments on December 31, 2016. Refer to the Chart of Accounts for exact wording of account titles. Be sure to enter the year as part of the date.

CHART OF ACCOUNTSGeneral 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
161 Trading Investments
162 Available-for-Sale Investments
165 Valuation Allowance for Trading Investments
166 Valuation Allowance for Available-for-Sale Investments
181 Land
193 Office Equipment
194 Accumulated Depreciation-Office Equipment
LIABILITIES
210 Accounts Payable
221 Notes Payable
231 Interest Payable
241 Salaries 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 (Loss) on Available-for-Sale Investments
351 Cash Dividends
352 Stock Dividends
390 Income Summary
REVENUE
410 Sales
611 Interest Revenue
612 Dividend Revenue
631 Gain on Sale of Investments
641 Unrealized Gain on Trading Investments
EXPENSES
511 Cost of Merchandise Sold
512 Bad Debt Expense
516 Cash Short and Over
520 Salaries Expense
531 Advertising Expense
534 Selling Expenses
535 Rent Expense
537 Office Supplies Expense
562 Depreciation Expense-Office Equipment
590 Miscellaneous Expense
710 Interest Expense
731 Loss on Sale of Investments
741 Unrealized Loss on Trading Investments

Prepare the adjusting entry to record the unrealized gain or loss on available-for-sale investments on December 31, 2016. 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

DATE DESCRIPTION POST. REF. DEBIT CREDIT

1

Adjusting Entries

2

3

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