December 31, 2020 Unrealized Gain Investments (Trading) Fair Value Cost (Loss) Clemson Corp. stock $19,500 $(1,000 ) (1,100 ) $18,500 Colorado Co. stock 9,100 ৪,000 Buffaloes Co. stock 19,500 20,140 640 Total of portfolio $48,100 $46,640 (1,460) Previous fair value adjustment balance Fair value adjustment-Cr. $(1,460 ) During 2021, Colorado Co. stock was sold for $8,480. The fair value of the stock on December 31, 2021, was Clemson Corp. stock-$18,600; Buffaloes Co. stock-$20,040. None of the ec investments result in significant influence.

December 31, 2020 Unrealized Gain Investments (Trading) Fair Value Cost (Loss) Clemson Corp. stock $19,500 $(1,000 ) (1,100 ) $18,500 Colorado Co. stock 9,100 ৪,000 Buffaloes Co. stock 19,500 20,140 640 Total of portfolio $48,100 $46,640 (1,460) Previous fair value adjustment balance Fair value adjustment-Cr. $(1,460 ) During 2021, Colorado Co. stock was sold for $8,480. The fair value of the stock on December 31, 2021, was Clemson Corp. stock-$18,600; Buffaloes Co. stock-$20,040. None of the ec investments result in significant influence.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 23E

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During 2021, Anthony Company purchased debt securities as a long-term investment and classified them as trading. All securities were purchased at par value. Pertinent data are as follows: The net holding gain or loss included in Anthonys income statement for the year should be: a. 0 b. 3,000 gain c. 9,000 loss d. 12,000 loss
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On December 21, 2020, Bucky Katt Company provided you with the following information regarding its equity investments. December 31, 2020 Investments Cost Fair Value Unrealized Gain (Loss) Clemson Corp. stock $20,000 $19,000 $(1,000) Colorado Co. stock 10,000 9,000 (1,000) Buffaloes Co. stock 20,000 20,600 600 Total of portfolio $50,000 $48,600 (1,400) Previous fair value adjustment balance –0– Fair value adjustment—Cr. $(1,400) During 2021, Colorado Co. stock was sold for $9,400. The fair value of the stock on December 31, 2021, was Clemson Corp. stock—$19,100; Buffaloes Co. stock—$20,500. None of the equity investments result in significant influence. Instructions a. Prepare the adjusting journal entry needed on December 31, 2020. b. Prepare the journal entry to record the sale of the Colorado Co. stock during 2021. c. Prepare the adjusting journal entry needed on December 31, 2021.
On December 21, 2020, Pearl Company provided you with the following information regarding its equity investments. December 31, 2020 Investments (Trading) Cost Fair Value Unrealized Gain (Loss) Clemson Corp. stock $21,300 $20,300 $(1,000 ) Colorado Co. stock 9,100 8,200 (900 ) Buffaloes Co. stock 21,300 21,860 560 Total of portfolio $51,700 $50,360 (1,340 ) Previous fair value adjustment balance 0 Fair value adjustment—Cr. $(1,340 ) During 2021, Colorado Co. stock was sold for $8,650. The fair value of the stock on December 31, 2021, was Clemson Corp. stock—$20,390; Buffaloes Co. stock—$21,770. None of the equity investments result in significant influence. (a) Prepare the adjusting journal entry needed on December 31, 2020. (b) Prepare the journal entry to record the sale of the Colorado Co. stock during 2021. (c) Prepare the adjusting journal entry needed on December 31, 2021.…
On December 21, 2020, Buffalo Company provided you with the following information regarding its equity investments. December 31, 2020 Investments (Trading) Cost Fair Value Unrealized Gain (Loss) Clemson Corp. stock $ 19,200 $ 18,300 $( 900 ) Colorado Co. stock 9,500 8,600 ( 900 ) Buffaloes Co. stock 19,200 19,800 600 Total of portfolio $ 47,900 $ 46,700 ( 1,200 ) Previous fair value adjustment balance 0 Fair value adjustment—Cr. $( 1,200 ) During 2021, Colorado Co. stock was sold for $ 9,150. The fair value of the stock on December 31, 2021, was Clemson Corp. stock—$ 18,400; Buffaloes Co. stock—$ 19,690. None of the equity investments result in significant influence. (a) Prepare the adjusting journal entry needed on December 31, 2020. (b) Prepare the journal entry to record the sale of the Colorado Co. stock during 2021. (c) Prepare the adjusting journal entry needed on…
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On December 21, 2020, Grouper Company provided you with the following information regarding its equity investments. December 31, 2020 Investments (Trading) Cost Fair Value Unrealized Gain (Loss) Clemson Corp. stock $21,600 $20,700 $(900 ) Colorado Co. stock 10,700 9,600 (1,100 ) Buffaloes Co. stock 21,600 22,200 600 Total of portfolio $53,900 $52,500 (1,400 ) Previous fair value adjustment balance 0 Fair value adjustment—Cr. $(1,400 ) During 2021, Colorado Co. stock was sold for $10,140. The fair value of the stock on December 31, 2021, was Clemson Corp. stock—$20,790; Buffaloes Co. stock—$22,110. None of the equity investments result in significant influence. (a) Prepare the adjusting journal entry needed on December 31, 2020. (b) Prepare the journal entry to record the sale of the Colorado Co. stock during 2021. (c) Prepare the adjusting journal entry needed on December 31,…
On December 21, 2020, Zurich Company provided you with the following information regarding its trading investments. December 31, 2020 Investments (Trading) Cost Fair Value Unrealized Gain (Loss) Stargate Corp. shares $20,000 $19,000 $(1,000) Carolina Co. shares 10,000 9,000 (1,000) Vectorman Co. shares 20,000 20,600 600 Total of portfolio $50,000 $48,600 $(1,400) Previous fair value adjustment balance –0– Fair value adjustment—Cr. $(1,400) During 2021, Carolina Co. shares were sold for $9,500. The fair value of the shares on December 31, 2021, was Stargate Corp. shares—$19,300; Vectorman Co. shares—$20,500. Instructions a. Prepare the adjusting journal entry needed on December 31, 2020. b. Prepare the journal entry to record the sale of the Carolina Co. shares during 2021. c. Prepare the adjusting journal entry needed on December 31, 2021.
On December 21, 2020, Vaughn Company provided you with the following information regarding its equity investments. Securities Cost Fair Value Unrealized Gain(Loss) SC Corp. stock $43,300 39,520 $(3,780 ) True Co. stock 48,800 55,390 6,590 Plus, Inc. stock 30,200 29,882 (318 ) Total of portfolio $122,300 $124,792 2,492 Previous fair value adjustment balance -0- Fair value adjustment – Dr. $2,492 During 2021, the Plus, Inc. stock was sold for $30,750. The fair value of the stock on December 31, 2021, was: SC Corp. stock—$40,070; True Co. stock—$51,080. None of the equity investments result in significant influence. Prepare the adjusting journal entry needed on December 31, 2020. (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.) Date Account Titles…
At December 31, 2020, the available-for-sale debt portfolio for Steffi Graf, Inc. is as follows. Security Cost Fair Value Unrealized Gain (Loss) A $17,500 $15,000 ($2,500) B 12,500 14,000 1,500 C 23,000 25,500 2,500 Total $53,000 $54,500 1,500 Previous fair value adjustment balance—Dr. 400 Fair value adjustment—Dr. $1,100 On January 20, 2021, Steffi Graf, Inc. sold security A for $15,100. The sale proceeds are net of brokerage fees. Assume that Steffi Graf, Inc. reports net income in 2020 of $120,000 and in 2021 of $140,000. Total holding gains (including any realized holding gain or loss) equal $40,000 in 2021. Instructions a. Prepare a statement of comprehensive income for 2020, starting with net income. b. Prepare a statement of comprehensive income for 2021, starting with net income.
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