Required informationProblem 15-3A Debt investments in available-for-sale securities; unrealized and realized gains and losses LO P3Skip to question [The following information applies to the questions displayed below.] Stoll Co.'s long-term available-for-sale portfolio at the start of this year consists of the following. Available-for-Sale SecuritiesCostFair ValueCompany A bonds$533,600 $492,000 Company B notes 159,310 150,000 Company C bonds 661,900 641,950 Stoll enters into the following transactions involving its available-for-sale debt securities this year. Jan. 29 Sold one-half of the Company B notes for $78,430.July 6 Purchased bonds of Company X for $120,800.Nov. 13 Purchased notes of Company Z for $267,100.Dec. 9 Sold all of the bonds of Company A for $524,100.The fair values at December 31 are B, $82,500; C, $609,100; X, $118,000; and Z, $279,000. Required 1Required 2Prepare journal entries to record these transactions, including the December 31 adjusting entry to record the fair valueadjustment for the long-term investments in available-for-sale securities.NoDateGeneral JournalDebitCredit1Jan. 29Cash78,430 OLoss on sale of debt investments1,225Debt investments - AFS79,6552Jul 06Debt investments - AFS120,800Cash120,8003Nov. 13Debt investments - AFS267,100Cash267,100 O4Dec. 9CashLoss on sale of debt investmentsDebt investments - AFSDec. 31Fair value adjustment - AFSUnrealized loss - Equity< Required 1Required 2 >

The loss or gain on investment is realized on the basis of the fair market value of investments.

Answered: Required information Problem 15-3A Debt…

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter13: Marketable Securities And Derivatives

Section: Chapter Questions

Problem 24P

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Required information

Problem 15-3A Debt investments in available-for-sale securities; unrealized and realized gains and losses LO P3

Skip to question

[The following information applies to the questions displayed below.]

Stoll Co.'s long-term available-for-sale portfolio at the start of this year consists of the following.

Available-for-Sale Securities	Cost	Fair Value
Company A bonds	$	533,600	$	492,000
Company B notes		159,310		150,000
Company C bonds		661,900		641,950

Stoll enters into the following transactions involving its available-for-sale debt securities this year.

Jan.	29	Sold one-half of the Company B notes for $78,430.
July	6	Purchased bonds of Company X for $120,800.
Nov.	13	Purchased notes of Company Z for $267,100.
Dec.	9	Sold all of the bonds of Company A for $524,100.

The fair values at December 31 are B, $82,500; C, $609,100; X, $118,000; and Z, $279,000.

Required 1
Required 2
Prepare journal entries to record these transactions, including the December 31 adjusting entry to record the fair value
adjustment for the long-term investments in available-for-sale securities.
No
Date
General Journal
Debit
Credit
1
Jan. 29
Cash
78,430 O
Loss on sale of debt investments
1,225
Debt investments - AFS
79,655
2
Jul 06
Debt investments - AFS
120,800
Cash
120,800
3
Nov. 13
Debt investments - AFS
267,100
Cash
267,100 O
4
Dec. 9
Cash
Loss on sale of debt investments
Debt investments - AFS
Dec. 31
Fair value adjustment - AFS
Unrealized loss - Equity
< Required 1
Required 2 >

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