Please help me with questions 4.(prepare the adjusting entry) and 5. (calculate the ending value of the fair value) at the bottom of the page.
Harris Company, which began operations in 2015, invests its idle cash in trading securities. The following transactions relate to its short-term investments in its trading securities in 2015 Mar 10 Purchased 2,400 shares of AOL at $61.15 per share plus a $1,545 commission. May 7 Purchased 5,000 shares of MTV at $36.25 per share plus a $2,955 commission. Sept. 1 Purchased 1,175 shares of UPS at $57.25 per share plus a $1,250 commission Dec. 31 Fair Value of the short-term investments in trading securities is $398,000 1. Prepare the journal entries to record the above transactions Date General Journal Debit Credit 3/10 Short-Term Investments Trading AOL 148,305 Cash 148,305 5/7 Short-Term Investments Trading MTV 184,205 Cash 184,205 9/1 Short-Term Investments Trading UPS 62,644 Cash 62,644 1 12/31 Fair Value Adjustment Trading 2.846 Unrealized Gain Income 2.846 2. Calculate the cost of the portfolio owned on December 31, 2015 148,305184,205 62,644 395,154 3. Calculate the Unrealized Gain or Loss on the portfolio on December 31,2015 398,000 395,1542,846 (gain) 4.Prepare the adjusting entry to record any necessary fair value adjustments for the portfolio of trading securities. Date General Journal Debit Credit 12/31 Fair Value Adjustment-Trading 2.846 Unrealized Gain Income 2,846 5. Calculate the ending value of the Fair Value- Trading account. Unadjusted balance $0 (first year in operation) Fair Value Adj - Trading $2,846 Dr. Ending balance: $2,846 Harris Company, which began operations in 2015, invests its idle cash in trading securities. The following transactions relate to its short-term investments in its trading securities in 2016 Apr 26 Sold 5,000 shares of MTV at $34.50 per share less a $2,125 commission Apr 27 Sold 1,175 shares of UPS at $60.50 per share less a $1,768 commission. June 2 Purchased 3,550 shares of SPW at $172 per share plus a S3,250 commission June 14 Purchased 900 shares of Walmart at $50.25 per share plus a $1,080 commission. Dec. 31 Fair Value of the short-term investments in trading securities is $826,000 1. Prepare the journal entries to record the above transactions Date April 26 General Journal Cash Loss on Sale Short Term Investment -MTV Short Term Investment MTV Debit 170375 13839 redit 184205 Cash Gain on Sale Short Term Investment UPS Short Term Investment April 27 69319 800 68519 June 2 Short Term Investment 613850 Cash 613850 June 14 ShortTerm Investment 46305 Cash 46305 2. Calculate the cost of the portfolio owned on December 31, 2016 3. Calculate the Unrealized Gain or Loss on the portfolio on December 31,2016 4.Prepare the adjusting entry to record any necessary fair value adjustments for the portfolio of trading securities. Date General Journal Debit Credit 5. Calculate the ending value of the Fair Value- Trading account
