Both Point Required The following information shows Carperk Company's individual investments in securities during its current year, along with theDecember 31 fair values.a. Investment in Brava Company bonds: $420,500 cost; $457,000 fair value. Carperk intends to hold these bonds until they mature in5 years.b. Investment in Baybridge common stock: 29,500 shares; $362,450 cost; $391,375 fair value. Carperk owns 32% of Baybridge'svoting stock and has a significant influence over Baybridge.c. Investment in Duffa bonds: $165,500 cost; $178,000 fair value. This investment is not readily marketable and is not classified asheld-to-maturity or trading.d. Investment in Newton notes: $90,300 cost; $88,625 fair value. Newton notes are not readily marketable and are not classified asheld-to-maturity or trading.e. Investment in Farmers common stock: 16,300 shares; $100,860 cost; $111,210 fair value. This stock is marketable, and Carperkintends to sell it within the year. This stock investment results in Carperk having an insignificant influence over Farmers.Required:1. Identify whether each investment should be classified as a short-term or long-term investment. For each investment, indicate inwhich of the six investment classifications it should be placed.2. Prepare a journal entry dated December 31 to record the fair value adjustment for the portfolio of available-for-sale debt securities.Carperk had no available-for-sale debt securities prior to this year.Complete this question by entering your answers in the tabs below.Required 1 Required 2Identify whether each investment should be classified as a short-term or long-term investment. For each investment, indicatein which of the six investment classifications it should be placed.Type of InvestmentClassification of Long-term Investmenta.b.Cd.e.< Required 1Required 2 >

Long Term Investment :— Investment Hold for More than 1 year. Short Term Investment:— Investment…

Required: 1. Identify whether each investment should be classified as a short-term or long-term investment. For each investment, indicate in which of the six investment classifications it should be placed. 2. Prepare a journal entry dated December 31 to record the fair value adjustment for the portfolio of available-for-sale debt securities. Carperk had no available-for-sale debt securities prior to this year.

Required: 1. Identify whether each investment should be classified as a short-term or long-term investment. For each investment, indicate in which of the six investment classifications it should be placed. 2. Prepare a journal entry dated December 31 to record the fair value adjustment for the portfolio of available-for-sale debt securities. Carperk had no available-for-sale debt securities prior to this year.

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

Chapter16: Retained Earnings And Earnings Per Share

Section: Chapter Questions

Problem 26P

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