Elaina Company has the following investments as of December 31, 2020: Investments in common stock of Laser Company $1,430,000 Investment in debt securities of FourSquare Company $3,090,000 In both investments, the carrying value and the fair value of these two investments are the same at December 31, 2020. Elaina’s stock investments does not result in significant influence on the operations of Laser Company. Elaina’s debt investment is considered held-to-maturity. At December 31, 2021, the shares in Laser Company are valued at $990,000; the debt investment securities of FourSquare are valued at $2,310,000 and are considered impaired. Prepare the journal entry to record the impairment of the debt securities at December 31, 2021.
Elaina Company has the following investments as of December 31, 2020: Investments in common stock of Laser Company $1,430,000 Investment in debt securities of FourSquare Company $3,090,000 In both investments, the carrying value and the fair value of these two investments are the same at December 31, 2020. Elaina’s stock investments does not result in significant influence on the operations of Laser Company. Elaina’s debt investment is considered held-to-maturity. At December 31, 2021, the shares in Laser Company are valued at $990,000; the debt investment securities of FourSquare are valued at $2,310,000 and are considered impaired. Prepare the journal entry to record the impairment of the debt securities at December 31, 2021.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter12: Intangibles
Section: Chapter Questions
Problem 18E
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Elaina Company has the following investments as of December 31, 2020:
| Investments in common stock of Laser Company | $1,430,000 |
| Investment in debt securities of FourSquare Company | $3,090,000 |
In both investments, the carrying value and the fair value of these two investments are the same at December 31, 2020. Elaina’s stock investments does not result in significant influence on the operations of Laser Company. Elaina’s debt investment is considered held-to-maturity. At December 31, 2021, the shares in Laser Company are valued at $990,000; the debt investment securities of FourSquare are valued at $2,310,000 and are considered impaired.
Prepare the
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