Question
Presented below is information related to the purchases of common stock by Vaughn Company during 2017. Cost (at purchase date) Fair Value (at December 31)
Presented below is information related to the purchases of common stock by Vaughn Company during 2017.
| Cost (at purchase date) | Fair Value (at December 31) | |||
| Investment in Arroyo Company stock | $102,000 | $84,000 | ||
| Investment in Lee Corporation stock | 259,000 | 314,000 | ||
| Investment in Woods Inc. stock | 184,000 | 193,000 | ||
| Total | $545,000 | $591,000 |
(Assume a zero balance for any Fair Value Adjustment account.)
| (a) | What entry would Vaughn make at December 31, 2017, to record the investment in Arroyo Company stock if it chooses to report this security using the fair value option? | |
| (b) | What entry would Vaughn make at December 31, 2017, to record the investments in the Lee and Woods corporations, assuming that Vaughn did not select the fair value option for these investments? |
(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.)
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Accounting What The World's Best Forensic Accountants And Auditors Know About Forensic Accounting And Auditing That You Dont
Authors: Greg Shields
1st Edition
1647483255, 978-1647483258
