The following was reported by Church Financial in its December 31, 2017, financial statements:
Short-term investments at FVTPL-equity, December 31, 2016$......11,000
Short-term investments at FVTPL-equity, December 31, 2017.......15,000
Gain on fair value adjustment-FVTPL....................................2,500
Loss on sale of FVTPL investments.........................................3,000
The carrying value of the investments sold was $4,000.
Instructions
(a) What is the cash amount received on the sale of the investment?
(b) Prepare the journal entries that were recorded by Church to record the sale of the investment and the gain on fair value adjustment at December 31, 2017.
(c) Post the journal entries to the Short-Term Investment sat FVTPL-Equity T account.
(d) Calculate the amount of investments purchased in 2017. Prepare the entry to record the purchase.