Answered: Name Number of Shares Total Cost Total…

Name Number of Shares Total Cost Total Fair Value $ 44,800 $ 40,000 Griffin Inc. 1,600 Luck Company 1,250 37,500 33,750 Wilson Company 1,000 40,000 37,000 Total $117,500 $115,550

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

Chapter15: Contributed Capital

Section: Chapter Questions

Problem 17E

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Question

Gruden Bancorp Inc. purchased a portfolio of trading securities during Year 1. The cost and fair value of this portfolio on December 31, Year 1, was as follows:

Please see the attachment for details:

On May 10, Year 2, Gruden Bancorp Inc. purchased 1,200 shares of Carroll Inc. at $29 per share plus a $100 brokerage commission.
Provide the journal entries to record the following:
a. The adjustment of the trading security portfolio to fair value on December 31, Year 1.
b. The May 10, Year 2, purchase of Carroll Inc. stock.

Name
Number of Shares
Total Cost
Total Fair Value
$ 44,800
$ 40,000
Griffin Inc.
1,600
Luck Company
1,250
37,500
33,750
Wilson Company
1,000
40,000
37,000
Total
$117,500
$115,550

Definition Definition Method of recording financial transactions in the book of original entry by debiting and crediting the accounts affected by a transaction using the golden rules of accrual accounting.

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