P12-3A Journalize transactions and adjusting entry for stock investments.

On December 31, 2015, Turnball Associates owned the following securities, held as a long-term

investment. The securities are not held for influence or control of the investee.

Common Stock

Shares

Cost

Gehring Co.

2,000

$60,000

Wooderson Co.

5,000

45,000

Kitselton Co.

1,500

30,000

On December 31, 2015, the total fair value of the securities was equal to its cost. In 2016,

the following transactions occurred.

July 1

Received $1 per share semiannual cash dividend on Wooderson Co. common stock.

Aug. 1

Received $0.50 per share cash dividend on Gehring Co. common stock.

Sept. 1

Sold 1,500 shares of Wooderson Co, common stock for cash at $8 per share.

Oct. 1

Sold 800 shares of Gehring Co. common stock for cash at $33 per share.

Nov. 1

Received $1 per share cash dividend on Kitselton Co. common stock.

Dec. 15

Received $0.50 per share cash dividend on Gehring Co. common stock.

Dec 31

Received $1 per share semiannual cash dividend on Wooderson Co. common stock.

At December 31, the fair values per share of the common stocks were Gehring Co. $32,

Wooderson Co. $8, and Kitselton Co. $18.

Instructions

(a) Journalize the 2016 transactions and post to the account Stock Investments. (Post in

T-account form.)

(b) Prepare the adjusting entry at December 31, 2016, to show the securities at fair value.

The stock should be classified as available-for-sale securities.

(c ) Show the balance sheet presentation of the investment-related accounts at December 31,

2016. At this date, Turnball Associates has common stock $1,500,000 and retained

earnings $1,000,000.

NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?" .

(a)	2016
	July 1	Account				Value
			Account				Value
	Aug 1	Account				Value
			Account				Value
	Sept. 1	Account				Value
		Account				Value
			Account				Value
	Oct.1	Account				Value
			Account				Value
			Account				Value
	Nov. 1	Account				Value
			Account				Value
	Dec. 15	Account				Value
			Account				Value
	Dec. 31	Account				Value
			Account				Value
	Stock Investments
	2016		2016
	Jan. 1 Balance	Value	Sept. 1	Value
			Oct. 1	Value
	2016
	Dec. 31 Balance	Value
(b)	Dec.31	Account				Value
			Account				Value
	Security	Cost	Fair Value
	Gehring Co.	Value	Value
	Wooderson Co.	Value	Value
	Kitselton Co.	Value	Value
		?	?
(c)	Investments
	Investments in stock of less than 20%
	owned companies, at fair value				Value
	Stockholders' equity
	Common stock			Value
	Retained earnings			Value
	Total paid-in capital and retained earnings			?
	Less: Unrealized loss on available-for-sale securities			Value
	Total stockholders' equity				?
After you have completed P12-3A, consider the additional question.
1.	Assume that number of shares of Wooderson Co. sold changed to 2,000 shares.
	Show impact on the journal entries and presentation in balance sheet.