Prepare Tiker Company’s journal entries to record the following transactions and the adjusting entry to record the fair value of the stock investments portfolio. This is the first and only time the company purchased such securities. May 9 Purchases 200 shares of Higo stock as a short-term investment at a cost of $30 per share. Tiker has insignificant influence over Higo. June 2 Sells 20 shares of its investment in Higo stock ($600 cost) at $33 per share. Dec. 31 The closing market price (fair value) of the Higo stock is $23 per share.

CONCEPTS IN FED.TAX.,2020-W/ACCESS
20th Edition
ISBN:9780357110362
Author:Murphy
Publisher:Murphy
Chapter9: Acquisitions Of Property
Section: Chapter Questions
Problem 80IIP
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Prepare Tiker Company’s journal entries to record the following transactions and the adjusting entry to
record the fair value of the stock investments portfolio. This is the first and only time the company purchased
such securities.
May 9 Purchases 200 shares of Higo stock as a short-term investment at a cost of $30 per share. Tiker
has insignificant influence over Higo.
June 2 Sells 20 shares of its investment in Higo stock ($600 cost) at $33 per share.
Dec. 31 The closing market price (fair value) of the Higo stock is $23 per share.

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