menu
bartleby
search
close search
Hit Return to see all results
close solutoin list

On January 1, Valuation Allowance for Available-for-Sale Investments had a zero balance. On December 31, the cost of the available-for-sale securities was $60,250, and the fair value was $57,500. Prepare the adjusting entry to record the unrealized gain or loss on available-for-sale investments on December 31.

BuyFindarrow_forward

Financial Accounting

15th Edition
Carl Warren + 2 others
Publisher: Cengage Learning
ISBN: 9781337272124

Solutions

Chapter
Section
BuyFindarrow_forward

Financial Accounting

15th Edition
Carl Warren + 2 others
Publisher: Cengage Learning
ISBN: 9781337272124
Chapter 15, Problem 5PEA
Textbook Problem
17 views

On January 1, Valuation Allowance for Available-for-Sale Investments had a zero balance. On December 31, the cost of the available-for-sale securities was $60,250, and the fair value was $57,500. Prepare the adjusting entry to record the unrealized gain or loss on available-for-sale investments on December 31.

To determine

Journalize the year-end valuation of available-for-sale securities transaction.

Explanation of Solution

Available-for-sale securities: These are short-term or long-term investments in debt and equity securities with an intention of holding the investment for some strategic purposes like meeting liquidity needs, or manage interest risk.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically.

Debit and credit rules:

  • Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts.
  • Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.

Prepare adjusting entry for valuation of available-for-sale securities transaction.

Table (1)

  • Unrealized Gain (Loss) on Available-for-Sale Investments is an adjustment account used to report gain or loss on adjusting cost of investment at fair market value...

Still sussing out bartleby?

Check out a sample textbook solution.

See a sample solution

The Solution to Your Study Problems

Bartleby provides explanations to thousands of textbook problems written by our experts, many with advanced degrees!

Get Started

Chapter 15 Solutions

Financial Accounting
Show all chapter solutions
add
Ch. 15 - Journalize the entries to record the following...Ch. 15 - Journalize the entries to record the following...Ch. 15 - On January 23, 10,000 shares of Tolle Company are...Ch. 15 - On September 12, 2,000 shares of Aspen Company are...Ch. 15 - On January 2, Cohan Company acquired 40% of the...Ch. 15 - On January 2, Yorkshire Company acquired 40% of...Ch. 15 - On January 1, Valuation Allowance for Trading...Ch. 15 - On January 1, Valuation Allowance for Trading...Ch. 15 - On January 1, Valuation Allowance for...Ch. 15 - On January 1, Valuation Allowance for...Ch. 15 - On June 30, Setzer Corporation had a market price...Ch. 15 - On October 23, Wilkerson Company had a market...Ch. 15 - Gonzalez Company acquired 200,000 of Walker Co.,...Ch. 15 - Torres Investments acquired 160,000 of Murphy...Ch. 15 - Bocelli Co. purchased 120,000 of 6%, 20-year Sanz...Ch. 15 - The following bond investment transactions were...Ch. 15 - On February 1, Hansen Company purchased 120,000 of...Ch. 15 - On February 22, Stewart Corporation acquired...Ch. 15 - The following equity investment transactions were...Ch. 15 - Yerbury Corp. manufactures construction equipment....Ch. 15 - Seamus Industries Inc. buys and sells investments...Ch. 15 - At a total cost of 5,600,000, Herrera Corporation...Ch. 15 - On January 4, Year 1, Ferguson Company purchased...Ch. 15 - On January 6, Year 1, Bulldog Co. purchased 34% of...Ch. 15 - Hawkeye Companys balance sheet reported, under the...Ch. 15 - JED Capital Inc. makes investments in trading...Ch. 15 - The investments of Charger Inc. include a single...Ch. 15 - Gruden Bancorp Inc. purchased a portfolio of...Ch. 15 - Last Unguaranteed Financial Inc. purchased the...Ch. 15 - The income statement for Delta-tec Inc. for the...Ch. 15 - Highland Industries Inc. makes investments in...Ch. 15 - The investments of Steelers Inc. include a single...Ch. 15 - Hurricane Inc. purchased a portfolio of...Ch. 15 - Storm, Inc. purchased the following...Ch. 15 - During Year 1, its first year of operations,...Ch. 15 - During Year 2, Copernicus Corporation held a...Ch. 15 - At the market close on May 12 of a recent year,...Ch. 15 - The market price for Microsoft Corporation closed...Ch. 15 - eBay Inc. developed a web-based marketplace at...Ch. 15 - On May 12, Year 1, Chewco Co. purchased 2,000...Ch. 15 - On December 31, Year 1, Valur Co. had the...Ch. 15 - Soto Industries Inc. is an athletic footware...Ch. 15 - Rios Financial Co. is a regional insurance company...Ch. 15 - Forte Inc. produces and sells theater set designs...Ch. 15 - OBrien Industries Inc. is a book publisher. The...Ch. 15 - Rekya Mart Inc. is a general merchandise retail...Ch. 15 - Zeus Investments Inc. is a regional investment...Ch. 15 - Glacier Products Inc. is a wholesaler of rock...Ch. 15 - Teasdale Inc. manufactures and sells commercial...Ch. 15 - Selected transactions completed by Equinox...Ch. 15 - Financial assets include stocks and bonds. These...Ch. 15 - In groups of three or four, find the latest annual...Ch. 15 - Berkshire Hathaway, the investment holding company...Ch. 15 - On July 16, 20Y1, Wyatt Corp. purchased 40 acres...Ch. 15 - International Financial Reporting Standard No. 16...

Additional Business Textbook Solutions

Find more solutions based on key concepts
Show solutions add
How did the customer orientation evolve?

Foundations of Business (MindTap Course List)

Should an economic model describe reality exactly?

Essentials of Economics (MindTap Course List)

NPV PROFILES: SCALE DIFFERENCES A company is considering two mutually exclusive expansion plans. Plan A require...

Fundamentals of Financial Management, Concise Edition (with Thomson ONE - Business School Edition, 1 term (6 months) Printed Access Card) (MindTap Course List)