The investments of Steelers Inc. include a single investment: 33,100 shares of Bengals Inc. common stock purchased on September 12, Year 1, for $13 per share including brokerage commission. These shares were classified as available-for-sale securities. As of the December 31, Year 1, balance sheet date, the share price declined to $11 per share.a. Journalize the entries to acquire the investment on September 12 and record the adjustment to fair value on December 31, Year 1.b. How is the unrealized gain or loss for available-for-sale investments disclosed on the financial statements?

Financial Accounting
14th Edition
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Carl Warren, Jim Reeve, Jonathan Duchac
Chapter15: Investments And Fair Value Accounting
Section: Chapter Questions
Problem 20E: The investments of Steelers Inc. include a single investment: 33,100 shares of Bengals Inc. common...
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The investments of Steelers Inc. include a single investment: 33,100 shares of Bengals Inc. common stock purchased on September 12, Year 1, for $13 per share including brokerage commission. These shares were classified as available-for-sale securities. As of the December 31, Year 1, balance sheet date, the share price declined to $11 per share.
a. Journalize the entries to acquire the investment on September 12 and record the adjustment to fair value on December 31, Year 1.
b. How is the unrealized gain or loss for available-for-sale investments disclosed on the financial statements?

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